78466

João Paulo Machado Ribeiro
Edilson Paulo
Cristian Baú Dal Magro

Revista Contabilidade & Finanças

This study analyzed the effects of firm life cycle stages (LCS) and their changes on the level of adoption of earnings management strategies. Gaps were identified regarding the effects of the transition between various life cycle stages and the propensity for accrual-based earnings management (AEM) and real activities earnings management (REM), as well as the impacts on the trade-off or complementarity relationship between them. The findings reinforce the need for auditors, financial analysts, investors, and regulators to consider company context and specific characteristics, such as firm cycle stage, when analyzing earnings management. The results suggest a greater propensity for all earnings management strategies, in order to hide financial difficulties, at the beginning of the decline stage. A total of 185 companies listed on the Brazilian capital market were analyzed for the period from 2011 to 2022, with data collected from Refinitiv®. Park and Chen’s (2006) model has been adopted to classify firm life cycle stages, and the models were estimated by the system generalized method of moments (system GMM). Growth stage firms use overproduction and avoid discretionary expense cuts as REM strategies. However, when transitioning from the growth stage to the mature stage, they are more likely to cut discretionary expenses as an REM strategy. The use of AEM is more prevalent in the decline stage, when compared to mature stage companies. The findings add evidence to the literature that the trade-off or complementarity relationship between AEM and REM is influenced by firm LCS and their transitions.

discretionary accruals, earnings quality, firm life cycle, learnings management

RIBEIRO, J. P. M.; PAULO, E.; MAGRO, C. B. D. Transição entre os estágios do ciclo de vida da firma e estratégias de gerenciamento de resultados. Revista Contabilidade & Finanças, v. 35, n. 96, p. 0-0, 2024.

Ribeiro, J. P. M., Paulo, E., & Magro, C. B. D. (2024). Transição entre os estágios do ciclo de vida da firma e estratégias de gerenciamento de resultados. Revista Contabilidade & Finanças, 35(96), 0-0.

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Artigo

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