The Effects of CEO Tenure on Earnings Management: The Role of CEO Career Origin and Affiliated Relationships

DOI

10.2991/iac-17.2018.19How to use a DOI?

Keywords

Earning Management; CEO Tenure; CEO Career Origin; CEO Affiliation; CEO Career Concerns

Abstract

Consensus about ownership concentration in Indonesian firms suggests that the agency problem in Indonesia is expected to be different from other countries. This study aims to review the impact of CEO career concerns on earnings management. The study uses the regression method with samples of CEOs of companies listed on the Indonesia Stock Exchange from 2012 to 2014. Newly appointed CEOs have been proved to use real and accruals earnings management to increase profits in the early period of their tenures, while CEOs leaving their posts use only real earning management to increasing earnings in the final year of their tenure. CEO career origin and shareholder affiliation have not been proved to effect newly appointed CEO’s earnings-management activities. The study concludes there is a preference for CEOs to use real earnings management during their tenures and so the enforcement of regulations related to the disclosure of management career profiles is encouraged.

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Massaid Bimo Setyawan
AU  - Viska Anggraita
PY  - 2017/08
DA  - 2017/08
TI  - The Effects of CEO Tenure on Earnings Management: The Role of CEO Career Origin and Affiliated Relationships
BT  - Proceedings of the 6th International Accounting Conference (IAC 2017)
PB  - Atlantis Press
SP  - 104
EP  - 111
SN  - 2352-5428
UR  - https://doi.org/10.2991/iac-17.2018.19
DO  - 10.2991/iac-17.2018.19
ID  - Setyawan2017/08
ER  -