Vol 4 No 2 (2017)
Articles

Detecting Earning Management of Companies Listing on HOSE

Vo Thi Quy
The Faculty of Business Administration International University, Vietnam
Duong Trong Nhan
The Faculty of Accounting Department Ho Chi Minh City Open University Ho Chi Minh City, Vietnam
Published December 11, 2017
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653 Views | 169 Downloads
Keywords
  • Earning Management, Jones Model, Modified Jones Model, HOSE.
Citations
How to Cite
Quy, V., & Nhan, D. (2017). Detecting Earning Management of Companies Listing on HOSE. Asian Journal of Social Sciences and Management Studies, 4(2), 82-87. https://doi.org/10.20448/journal.500.2017.42.82.87

Abstract

The study is aimed to detecting earning management from companies listing in Ho Chi Minh Stock Exchange (HOSE) during the period from 2013 – 2015 by using 2 models, Jones (1991) and Modified Jones Model developed by Dechow et al. (1995). Moreover, we also tested the effectiveness of Jones (1991) for detecting firms’ earning management since prior researches showed that Jones (1991) has lower standard error in detecting accruals based earning management compared with other models as suggested by DeAngelo et al. (1994). Hence we proposed that Jones (1991) provides a more significant outcome for estimating the nondiscretionary component of accruals and thus less exposed to misspecifications error from absent variables. We found that Jones (1991) illustrates a better explainable ability even though the adjusted R-square of the models is closely similar with each other.

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