ACC301-ch06

ACC301-ch06 - chapter 6 chapter Earnings Management An electronic presentation by Douglas Cloud Pepperdine University 1 Learning Objectives 1

Info iconThis preview shows pages 1–10. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Earnings  Earnings  Management Management An electronic presentation An electronic presentation by Douglas Cloud by Douglas Cloud Pepperdine University Pepperdine University chapter chapter   6 6
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 1. Identify the factors that motivate earnings management. 2. List the common techniques used to manage earnings. 3. Critically discuss whether a company should manage its earnings. Learning Objectives Continued Continued
Background image of page 2
3 4. Describe the common elements of an earnings management meltdown. 5. Explain how good accounting standards and ethical behavior by accountants lower the cost of obtaining capital . Learning Objectives
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 Motivation for Earning Management Forces pushing managers to manipulate results: 1. Meet internal targets. 2. Meet external expectations. 3. Provide income smoothing. 4. Provide window dressing for an IPO or a loan.
Background image of page 4
5 Motivation for Earning Management Internal earnings targets represent an important tool in motivating manager to increase sales efforts, control costs, and use resources more efficiently.
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6 Meet Internal Targets Meet Internal Targets Motivation for Earning Management There is a tendency for the person being evaluated to forget the economic factors underlying the measurement and instead focus on the measured number itself. Performance
Background image of page 6
7 Motivation for Earning Management Meet External Expectations Meet External Expectations Employees and customers want a company to do well so that it can survive for a long run and make good on its long-term pension and warranty obligations.
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
8 Motivation for Earning Management Meet External Expectations Meet External Expectations Suppliers want assurance that they will receive payment and that the purchasing company will be a reliable purchaser for many years into the future.
Background image of page 8
9
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 10
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 06/11/2009 for the course ACC 301 taught by Professor Pendarvis during the Spring '09 term at St. Leo.

Page1 / 32

ACC301-ch06 - chapter 6 chapter Earnings Management An electronic presentation by Douglas Cloud Pepperdine University 1 Learning Objectives 1

This preview shows document pages 1 - 10. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online