Financial Accounting Standard Committee modified the Statement of Financial Accounting Standards (SFAS) No.7 ¡§Consolidated Financial Statement¡¨ in 2004. The new standard was conducted in 2006. This study is to discuss the influence of the modified Standard on earnings management of Business Groups.
The test samples include 178 companies, which belong to 69 business groups. The test window is from 2005 June to 2007 June. We, using Modified Jones Model, compared the discriminate accruals generated from both consolidated financial statements and financial statements of parent companies. The findings of this study are presented as follows:
1. The modification of SFAS No.7 conducted no influence on earnings management and related party transactions of business groups.
2. After modified SFAS No.7 was conducted, the discriminate accruals generated from consolidated financial statements differ from those of financial statements of parent companies. However, no such difference exists before SFAS No.7 was modified.
The findings reveal that the modification of SFAS No.7 helps fully disclose the financial information of business groups. The stakeholders, therefore, should consider both consolidated financial information and financial statements of single parent companies.
| Identifer | oai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0801108-161522 |
| Date | 01 August 2008 |
| Creators | Wang, Chen-yee |
| Contributors | Ruey-Dang Chang, Pei-how Huang, Wu Chi Cheng |
| Publisher | NSYSU |
| Source Sets | NSYSU Electronic Thesis and Dissertation Archive |
| Language | Cholon |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0801108-161522 |
| Rights | restricted, Copyright information available at source archive |
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