레버리지가 이익조정에 미치는 영향: 몽골기업 중심으로

This study thoroughly investigates the effect of leverage on earnings management. We conducted a panel regression analysis using data from Mongolian companies from 2013 to 2019. The modified Jones model was employed to measure earnings management, ensuring a comprehensive and rigorous approach to our research. We find that leverage has a negative relationship with earnings management in Mongolian-listed companies. This means that debt concentration decreases the management’s discretionary behavior as the interest expense burden on earnings is strengthened. This is consistent with the prior research findings that higher leverage extends the need for operating cash flow, leading to decreased earnings management. Moreover, this paper analyzes leverage by dividing it into low and high. The subsample test presents that the reduction of discretionary accruals is pronounced for the subgroups with high leverage. In an additional test, we find that leverage positively affects earnings management in Mongolian unlisted companies. This implies monitoring management’s opportunistic behavior in unlisted companies is relatively difficult. Furthermore, this suggests that managers of unlisted companies increase earnings management to alleviate capital cost. This study is meaningful in empirically providing information on whether leverage boosts or reduces earnings management with Mongolian data. It sheds light on understanding the business environment and plays an important role in the capital market as a source of information for accounting transparency in Mongolia.