Earnings Management and Investor Protection: An International Comparison

ArXiv ID: ssrn-330200 “View on arXiv”

Authors: Unknown

Abstract

This paper examines the pervasiveness of earnings management across 31 countries between 1990 and 1999. It documents systematic differences in earnings manageme

Keywords: earnings management, cross-country analysis, accounting quality, financial restatements, equities

Complexity vs Empirical Score

• Math Complexity: 2.5/10
• Empirical Rigor: 7.0/10
• Quadrant: Street Traders
• Why: The paper is primarily an empirical accounting study using cross-country panel data and statistical tests, lacking advanced mathematical derivations, but is data-intensive and focused on real-world implications.

  flowchart TD
    A["Research Goal: Analyze<br/>earnings management prevalence<br/>and investor protection across 31 countries"] --> B["Data Source:<br/>1990-1999 Financial Statements<br/>(31 countries, multiple years)"]
    B --> C["Key Variables:<br/>Earnings Management<br/>Investor Protection Index<br/>Accounting Quality Metrics"]
    C --> D["Methodology:<br/>Cross-sectional analysis<br/>using discretionary accruals<br/>and financial restatements"]
    D --> E["Computational Process:<br/>Statistical comparison across<br/>countries and time periods"]
    E --> F["Key Finding 1:<br/>Earnings management is<br/>pervasive globally"]
    E --> G["Key Finding 2:<br/>Stronger investor protection<br/>reduces earnings management"]
    E --> H["Key Finding 3:<br/>Systematic differences<br/>exist across countries"]