Is Corporate Governance Effective in Earnings Management in Asian Emerging Markets?

Abstract

班佛法則在鑑識會計中已被廣泛應用於識別異常數值。本研究探討公司治理法規的施行如何影響亞洲新興市場企業的盈餘管理行為。研究樣本為1990年至2012年度共122,310筆正盈餘數據，其中中國為79,285筆觀察值，台灣為43,025筆觀察值。實証結果顯示亞洲新興市場中台灣與中國兩國家均存在美化盈餘管理現象，研究結果證實上市公司管理者可能存在將財報數據進位以超過認知參考點的行為。此外，與台灣企業相比，中國的企業管理者相較而言可能有更大的動機去進行盈餘操弄行為。值得注意的是，本研究發現隨著公司治理法規的施行，亞洲新興市場之企業管理者進行盈餘管理行為的程度已有顯著的減少，顯示公司治理的實施對於抑制管理者進行盈餘管理行為上扮演一個重要的角色，研究結果對於實施公司治理法規對於降低盈餘管理的有效性提供進一步的証據支持。

In forensic accounting, Benford's Law can be used to identify anomalous numerical data. This paper discusses how implementing corporate governance regulations affect earnings management of emerging markets in Asia. Benford's analysis was employed to evaluate 122,310 instances of positive earnings-79,285 in China and 43,025 in Taiwan-from 1990 to 2012. The empirical results showed that earnings manipulation occurred in Asian emerging markets. Our analyses revealed that the managers of publicly listed firms rounded up earnings to achieve key reference points. Chinese corporate managers seemed to have had stronger incentives to manipulate earnings than Taiwanese corporate managers. In addition, the extent of earnings management was significantly reduced after corporate governance regulations were implemented. The results indicated that implementing corporate governance regulations played a crucial role in reducing earnings manipulation behavior. The findings of this study verify the effectiveness of corporate governance regulations in detecting earnings management.