Unpublished Master's Dissertation, University of Molise.
ISSN/ISBN: Not available at this time. DOI: 10.13140/RG.2.2.36384.51204
Abstract: Purpose – The purpose of this research is to examine whether Italian municipally owned utility entities (MOUs) engage in earnings management around the time of local elections. Design/methodology/approach – A total of 506 Italian unlisted MOUs were examined between 2009 and 2014. The distribution of total revenues digits was examined using first-two digits tests based on Benford’s law, and 3036 observations comprised the data set. Findings – The empirical results show that firms tend to engage in CEM during election periods. There is evidence of total revenue manipulation, as well as indications of patterns of revenues rounding linked to political connections. Originality/value – This is the second study investigating pre-electoral earnings management in MOUs, extending the work of Capalbo et al. (2020). It applies the emerging Benford-based approach of detecting CEM in a new context, namely the Italian jurisdiction. It presents a novel research design to broaden the well-known relationship between the political process beyond the political cost hypothesis and accounting numbers.
Bibtex:
@mastersthesis{,
author = {Galati, Luca},
year = {2020},
month = {09},
pages = {},
title = {Do Municipally Owned Utilities Round Earnings Before Elections? An Application of the Benford's Law},
institution = {University of Molise},
doi = {10.13140/RG.2.2.36384.51204},
}
Reference Type: Thesis
Subject Area(s): Accounting