Earnings Management using Other Comprehensive Income Items: A Multi-Case Study on Chinese Listed Companies
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Xiaofang Zhao, Kuan Zhao, Wei Wei
This study investigates those other comprehensive income items reclassified and recognized outside of profit or loss as a tool for earnings management based on multi-case study methodology. Through the analysis of a series of samples of Chinese listed companies, we find some positive evidence that managers regard OCI items as complementary to earnings management, such as concealing losses, adjusting asset liability ratio, and smooth earnings.
Other Comprehensive Income, Earnings management, Multi-case study.