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dc.contributor.authorBozzolan, Saverio
dc.contributor.authorFabrizi, Michele
dc.contributor.authorMallin, Christine
dc.contributor.authorMichelon, Giovanna
dc.date.accessioned2015-12-18T12:52:03Z
dc.date.issued2015-11-06
dc.description.abstractIn this paper, we investigate whether the corporate social responsibility (CSR) orientation of a firm affects its reporting incentives, in terms of the trade-off between real earnings management (REM) and accrual-based earnings management (AEM). Furthermore, relying on previous literature on the relationship between legal enforcement and the trade-off between AEM and REM, we consider whether the CSR orientation plays a moderating role in this relationship. We base our study on a sample of 5,863 firm-year observations for 1,141 unique firms, covering 24 different countries over the period 2003–2009. We find that CSR-oriented firms are less likely to engage in REM than in AEM. Moreover, we document that in strong legal enforcement countries, incentives to use REM instead of AEM are significantly lower in companies with a high CSR orientation than in companies with a low CSR orientation. These findings are consistent with the expectation that CSR-oriented companies are less likely to engage in the more costly but harder to detect earnings management strategy, i.e. the strategy that alters the underlying real operations of the company (REM). We provide additional evidence for our arguments that CSR-oriented firms are more likely to give up REM than AEM because of its detrimental value on future performance. All together our evidence suggests that CSR orientation acts as a constraint for REM and in doing so it contributes to the creation of value for all stakeholders.en_GB
dc.identifier.citationVol. 50, Iss.4, pp. 361 - 396en_GB
dc.identifier.doi10.1016/j.intacc.2015.10.003
dc.identifier.urihttp://hdl.handle.net/10871/19023
dc.language.isoenen_GB
dc.publisherElsevieren_GB
dc.relation.urlhttp://www.sciencedirect.com/science/article/pii/S0020706315000813en_GB
dc.rights.embargoreasonPublisher's policy.en_GB
dc.rightsCopyright © 2015 University of Illinois. Published by Elsevier Inc. All rights reserved. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/en_GB
dc.subjectCorporate social responsibilityen_GB
dc.subjectAccrual earnings managementen_GB
dc.subjectReal earnings managementen_GB
dc.subjectEnforcementen_GB
dc.subjectPerformanceen_GB
dc.titleCorporate social responsibility and earnings quality: international evidenceen_GB
dc.typeArticleen_GB
dc.identifier.issn0020-7063
dc.descriptionArticleen_GB
dc.identifier.journalInternational Journal of Accountingen_GB


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