Irregularities in accounting numbers and earnings management- a novel approach based on SEC XBRL filings / Klaus Henselmann, Dominik Ditter, Elisabeth Scherr
Series: Journal of Emerging Technologies in Accounting. 12, page 117-151 Publication details: 2015.Content type:- txt
- unmediated
Current library | Call number | Status | Date due | Barcode |
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Manila Tytana Colleges Library REFERENCE SECTION | Not For Loan |
The SEC XBRL mandate enables the gathering of accounting numbers to be fully automatic in a database-like manner that provides vast opportunities for financial analysis. Using this functionality, this study proposes a simple analytical prescreening measure that uses abnormal digit distributions at the firm-year level to identify firms suspected of having managed earnings. On average, we find that the constructed measure indicates a greater amount of irregularities in the reported accounting numbers of firms with higher incentives to engage in earnings management. The suggested XBRL-enhanced digit analysis approach may provide the SEC and investors a simple measure to flag financial reports carrying a higher probability of human interaction.
Accountancy.
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