Earnings management and management reporting systems in the context of corporate acquisitions: An analysis of German and international accounting standards

Result code in IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F62156489%3A43110%2F21%3A43919595" target="_blank" >RIV/62156489:43110/21:43919595 - isvavai.cz</a>

Result on the web

<a href="http://www.iaetsdjaras.org/gallery/3-jaras-feb-1128.pdf" target="_blank" >http://www.iaetsdjaras.org/gallery/3-jaras-feb-1128.pdf</a>

DOI - Digital Object Identifier

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Result language

angličtina

Original language name

Earnings management and management reporting systems in the context of corporate acquisitions: An analysis of German and international accounting standards

Original language description

This is how the former CEO of the energy company Enron Kenneth Lay described in 2006 the way the company accounts, which misused earnings management measures and became insolvent in 2001 due to balance sheet falsification and manipulation. But what are the goals, capabilities and limits of earnings management, especially in the context of company acquisitions? This paper analyses from a scientific point of view and based on selected literature the possibilities of operating and limiting earnings management in the context of company acquisitions according to the German Commercial Code (Handelsgesetzbuch - HGB) and International Financial Reporting Standards (IFRS). The role of a management reporting system in the context of company acquisitions is also analysed. The following chapter first introduce the theoretical foundations of the terms earnings management and company acquisition. In particular earnings management as part of the accounting policy and company acquisition as the sub-item of all mergers and acquisitions transactions are examined here. During a corporate acquisition in which instruments of earnings management are going to use the managers need detailed and reliable information that can only be guaranteed by an efficient management reporting system. For this reason, the role of a management reporting system during a company acquisition will be analysed in the second chapter. In the further course, the goals of earnings management are worked out and these are brought into connection with company acquisitions. In addition, selected instruments of earnings management of international and German accounting standards are critically analysed in the course of company acquisitions. The instruments of earnings management in tax accounting are not explicitly dealt with here. Based on this, the normative and factual limits of earnings management are differentiated. In the conclusions at the end of the thesis, personal comments are made on the knowledge gained from earnings management in the context of company acquisitions.

Czech name

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Czech description

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Type

J_ost - Miscellaneous article in a specialist periodical

CEP classification

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OECD FORD branch

50204 - Business and management

Project

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Continuities

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Publication year

2021

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Name of the periodical

Journal for Advanced Research in Applied Sciences

ISSN

2394-8442

e-ISSN

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Volume of the periodical

8

Issue of the periodical within the volume

2

Country of publishing house

IN - INDIA

Number of pages

8

Pages from-to

15-22

UT code for WoS article

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EID of the result in the Scopus database

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