Event-specific earnings management: additional evidence from US M & A pre-and post-SOX

Alsharairi, M.; Dixon, R.; Al-Hamadeen, R.

doi:10.1108/jfra-11-2015-0097

Event-specific earnings management: additional evidence from US M & A pre-and post-SOX

Alsharairi, M.; Dixon, R.; Al-Hamadeen, R.

Authors

M. Alsharairi

Professor Rob Dixon robert.dixon@durham.ac.uk
Professor

R. Al-Hamadeen

Abstract

Purpose We re-examine the motivation to manage earnings in US M&As, by investigating whether the enactment of SOX has affected pre-merger earnings management. Design/methodology/approach Using a sample of over 700 completed M&As of US public firms during 1999-2008. Using quarterly reports, we track-down earnings management during the four quarters preceding the deal and consequently draw inferences about the implications of SOX on interim reporting practices. Findings Using a sample of over 700 completed M&As of US public firms during 1999-2008. Using quarterly reports, we track-down earnings management during the four quarters preceding the deal and consequently draw inferences about the implications of SOX on interim reporting practices. Originality/value Unlike what is anticipated regarding earnings management practices after SOX, the study reveals significant evidence of upward earnings management by firms engaging in M&A in post-SOX era.

Citation

Alsharairi, M., Dixon, R., & Al-Hamadeen, R. (2017). Event-specific earnings management: additional evidence from US M & A pre-and post-SOX. Journal of Financial Reporting and Accounting, 15(1), 78-98. https://doi.org/10.1108/jfra-11-2015-0097

Journal Article Type	Article
Acceptance Date	Jun 11, 2016
Online Publication Date	Apr 10, 2017
Publication Date	Apr 10, 2017
Deposit Date	Jun 30, 2016
Publicly Available Date	Jun 30, 2016
Journal	Journal of Financial Reporting and Accounting
Print ISSN	1985-2517
Publisher	Emerald
Peer Reviewed	Peer Reviewed
Volume	15
Issue	1
Pages	78-98
DOI	https://doi.org/10.1108/jfra-11-2015-0097
Public URL	https://durham-repository.worktribe.com/output/1401459

Files

Accepted Journal Article (527 Kb)
PDF

Copyright Statement
This article is © Emerald Group Publishing and permission has been granted for this version to appear here http://dro.dur.ac.uk/19165/. Emerald does not grant permission for this article to be further copied/distributed or hosted elsewhere without the express permission from Emerald Group Publishing Limited.