Regression-based learning for management motivation and earnings management methods

Abstract

The impact of management motivation on earnings management methods is studied based on 9581 samples from listed firms for the period between 2006 and 2011. This paper examines the influence of management motivation on investor sentiment and intends to study how management motivation influences investor sentiment by real earnings management activities and earnings management methods. The empirical results indicate that management use real earnings management to manipulate the earnings in order to turn a profit, avoid loss, refinance, and change executives. The listed companies with higher executive compensations intend to use real earnings management. However, making big profits by using real earnings management activities is not a universal phenomenon because capital market in our country is not perfect enough.