The purpose of this essay is to investigate if the companies listed on Nasdaq/OMX Stockholm Large Cap use the earnings management phenomenon Big Bath Accounting to a greater extent when a change of management (CEO) is made. Management tends to use earnings management when there is a bonus plan linked to the result of the company. To gain maximum bonus the management will try to manipulate the result in a way that in a long term maximize their utility. Through the earnings management technique Big Bath the management is given the possibility to take one large cost as a one-time expend, even though the cost is supposed to run over several financial years. This, of course, within the legal framework. A big bath may occur when there is an impairment of goodwill, tangible and/or intangible assets or larger provisions for future expense, or both of them at the same time.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:sh-9535 |
| Date | January 2011 |
| Creators | Lilja, Viktor, Richard, Johansson |
| Publisher | Södertörns högskola, Institutionen för ekonomi och företagande, Södertörns högskola, Institutionen för ekonomi och företagande |
| Source Sets | DiVA Archive at Upsalla University |
| Language | Swedish |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
Page generated in 0.1703 seconds