Journal of Emerging Technologies in Accounting 12 (1), pp. 117–151.
ISSN/ISBN: Not available at this time. DOI: 10.2308/jeta-51247
Abstract: 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.
Bibtex:
@article{,
author = {Klaus Henselmann and Dominik Ditter and Elisabeth Scherr},
title = {Irregularities in Accounting Numbers and Earnings Management -- A Novel Approach Based on SEC XBRL Filings},
journal = {Journal of Emerging Technologies in Accounting},
volume = {12},
number = {1},
pages = {117--151},
year = {2015},
doi = {10.2308/jeta-51247},
}
Reference Type: Journal Article
Subject Area(s): Accounting