Title : The School-Ties Between Top Management Executive and Audit Partner: Exploring from Earnings Management in Indonesia
Authors:
- Raden Roro Widya Ningtyas Soeprajitno
- Sri Ningsih
- Harymawan Faith
- Bablu Kumar Dhar
- Suham Cahyono
Department : Accounting
Journal Name : Sage Open Kinds of Journal: Q1
Keywords : school-ties, top management, auditor, earning management, governance
Abstract:
The objective of this study is to investigate the impact of school ties between top management executives, such as the chief executive officers and chief financial officers, and external parties, including auditors, on a company's earnings management practices. This study uses Fixed Effect Regression Method to Test the Hypothes, Whether School Ties Between Top Management Executives and Audit Partner Will Affect on the Practical Earnings Management. The Authors Obtained Sample from the Indonesia Stock Exchange Commission During 2010 to 2022 and Includes Several Causality Tests to Robust the Empirical Results from Current Study. Our Finding Suggest a Noteworthy Positive Association between School-Ties Linking the Chief Executive Officer (CEO) and the Auditor with Earnings Management. Howver, our analysis reveals that other combinations of school ties exhibit an opposite effect. The Findings of this Study Suggest that ties between internal and external parties within a company may be a factor that investors should be carefully consider when evaluating the accuracies and reliability of financial reports. As such, it
May be prudent to avoid investing in such compans. Despite Prior Research Extensively Examination The Measurement of Accrual-Based Earnings Management, The Literature Lacks Discussion Its Association with the Potential influence of Ties. Thus, this study aims to fill this gap by investigating the relationship between the top management school ties and earnings management.
For details : https://journals.sagepub.com/doi/epub/10.1177/21582440231220051