TY  - JOUR
TT  - The Effectiveness of Monitoring Mechanisms for Constraining Earnings Management: A Literature Survey for a Conceptual Framework
AU  - Saleem, Faiza
AU  - Alifiah, Mohd Norfian
AU  - Tahir, Muhammad Sohail
PY  - 2016
DA  - May
JF  - International Journal of Economics and Financial Issues
JO  - IJEFI
PB  - İlhan ÖZTÜRK
WT  - DergiPark
SN  - 2146-4138
SP  - 209
EP  - 214
VL  - 6
IS  - 3
KW  - Corporate Governance
KW  - Bankruptcy
KW  - External Audit
KW  - Earnings Management
N2  - Recently, financial crisis and high profile corporate scandals in the United States, Europe and East Asia, have brought corporate governance and audit quality issues to the forefront in developing countries, emerging markets and transitional economies. In fact, the main issue involves manipulation of accounting data which lose investor confidence and trust in the financial reports. In order to enrich investor confidence and trust regarding financial reporting quality, firms need to adopt effective monitoring mechanisms. In relation to that, this paper proposes a conceptual framework to investigate the role of regulatory mechanisms concentrating on corporate governance and external audit for mitigating earnings management. Evidence from previous studies supports the proposed model. Hence, the extant study argues that firms with effective monitoring mechanisms in the form of corporate governance and external audit are less likely to allow earnings management because opportunistic earning's cause uncertainty about the economic value of a firm.
UR  - https://dergipark.org.tr/tr/pub/ijefi/issue//352679
L1  - https://dergipark.org.tr/tr/download/article-file/363612
ER  -