http://www.nytimes.com/2015/10/25/business/earnings-misstatements-come-in-bunches-study-says.html
[snip] The study, “Evidence on Contagion in Earnings Management,” looked at the restatements of 2,249 companies from 1997 through 2008. It found that earnings manipulation at companies was strongly related to the percentage of firms in the same industry or the same region that had announced restatements in the previous 12 months. The study did not identify specific companies. But when bigger and more visible companies did the book-cooking, it found that the misconduct was more likely to be copied. The extent of a company’s initial restatement also had a bearing on whether it would be mimicked. Extreme restatements involving significant manipulation apparently were viewed as too risky to be imitated, the study found. It turns out that copycats abound in corporate America. Companies emulated their peers with remarkable precision, the study found. Follow-on misstatements often occurred in the same corporate accounts that the initial case involved, like revenue manipulation, expense account fudging and massaging of inventory, assets or restructuring accounts. “In a sense, restatements serve as handbooks of trickery,” Mr. Rajgopal said. [snip] _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
