기업수명주기별 이익조정과 미래경영성과

This paper studies the extent to which firms exercise earnings management(EM) conditioning on their life cycles and examines their levels of operating performance subsequent to EM. This study takes into account two kinds of earnings management, accrual earnings management(AEM) and real earnings management(REM). This study employs the method developed by Anthony and Ramesh(1992) for life－cycle classification. And, to main consistency with previous studies, EM－suspected firms are defined as the intersection of firms with abnormal accruals, abnormal levels of operating cash flow, production costs, or discretionary expenses and firms with asset－scaled earnings or asset－scaled earnings changes meeting the zero thresholds. The empirical results are as follows. First, firms in the growth stage exhibit less evidence of REM(and AEM) than firms in other stages, consistent with the fact that REM(and AEM) may result in severe economic consequences and consistent with the earning smoothing. Second, with respect to the economic consequences of EM, firms suspected in REM(and AEM) generally perform worse than those that do not, consistent with the opportunistic intention of managers in conducting EM, particularly for firms in the growth stage. Our results indicate that EM－suspected firms in the growth stage have lower Adj－ROA(Adj－CFO) than non－REM firms in any of the subsequent two years. Furthermore, there is little evidence to show that firms in the growth stage that engage in REM have a low Adj－ROA(Adj－CFO) in the subsequent two years than firms in other stages. The results present interesting topics for future research. Existing studies on EM have focused on upward earnings manipulation. Investigating downward earnings manipulation may reveal another aspect of the subsequent economic consequences of REM(and AEM).