Real Earnings Management and Accrual-based Earnings Management Implications for Future Profitability


  • Premarat Vilalai College of Innovative Business and Accountancy, Dhurakij Pundit University
  • Pattanant Petchchedchoo College of Innovative Business and Accountancy, Dhurakij Pundit University
  • Siridech Kumsuprom College of Innovative Business and Accountancy, Dhurakij Pundit University


Earnings Management, Real Earnings Management, Accrual-based Earnings, Future Profitability


This research reflects the future profitability of the organization by investigate the relationship between real earnings management and accrual-based earnings management implications for future profitability. Real earnings management by using of abnormal cash flows from operating activities, abnormal discretionary expenses and abnormal provision for doubtful accounts as a proxy and accrual-based earnings management by using of abnormal accruals. The sample group is used as the financial business industry group of 51 companies listed on the Stock Exchange of Thailand, with a population of 60 companies. And the statistics used in this research analysis are multiple regression analysis. The results indicated that real earnings management based on abnormal cash flows from operating activities is a positive relationship between the future profitability. Conversely, abnormal discretionary expenses, abnormal provision for doubtful accounts and accrual-based earnings management has no significant relationship with the future profitability.



ขวัญชนก สุขสนิท. (2559). ลักษณะของผู้บริหารกับการตกแต่งกำไร. การศึกษาค้นคว้าแบบอิสระบัญชีมหาบัณฑิต มหาวิทยาลัยธรรมศาสตร์.

จุฑารัธ พาลพ่าย. (2558). การตกแต่งกำไรในช่วงการเปลี่ยนแปลงประธานเจ้าหน้าที่บริหาร(CEO) กรณีศึกษาบริษัทจดทะเบียนในตลาดหลักทรัพย์แห่งประเทศไทย. การศึกษาค้นคว้าแบบอิสระวิทยาศาสตร์มหาบัณฑิต มหาวิทยาลัยธรรมศาสตร์.

วรวิทย์ เอื้อทรัพย์สกุล. (2552). ผลกระทบจากการเพิ่มขึ้นของการใช้เงินทุนโดยการก่อหนี้ (Leverage) กับการตกแต่งกำไร กรณีศึกษาบริษัทจดทะเบียนในตลาดหลักทรัพย์แห่งประเทศไทย. วิทยานิพนธ์บัญชีมหาบัณฑิต มหาวิทยาลัยธรรมศาสตร์.

อรจิรา ปัญจะเทวคุปต์. (2549). การตกแต่งบัญชีเพื่อประโยชน์ทางภาษีเงินได้นิติบุคคลผ่านบัญชีรายจ่าย. วิทยานิพนธ์บัญชีมหาบัณฑิต มหาวิทยาลัยธรรมศาสตร์.

อาภรณ์ แกล้วทนงค์, พัทธนันท์ เพชรเชิดชู, และศิริเดช คำสุพรหม. (2561). ความสัมพันธ์ระหว่างการเปิดเผยทุนทางปัญญากับคุณภาพกำไรและมูลค่าตามราคาตลาดของบริษัทจดทะเบียนในตลาด หลักทรัพย์แห่งประเทศไทยกลุ่มอุตสาหกรรมเทคโนโลยี. วารสารสุทธิปริทัศน์, 32(102), 98-112.

Alhadab, M., Clacher, I., & Keasey, K. (2015). Real and accrual earnings management and IPO failure risk. Accounting and Business Research, 45(1), 55–92.

Bengtsson, K., Bergström, C., & Nilsson, M. (2007). Earnings Management and CEO Turnovers. Thesis. Stockholm School of Economics, Sweden

Beyer, B.D., Nabar, S.M., & Rapley, E.T. (2018). Real Earnings Management by Benchmark-Beating Firms : Implications for Future Profitability. Accounting Horizons, 32(4), 59-84.

Bhojraj, S., Hribar, P., Picconi, M., & McInnis, J. M. (2009). Making Sense of Cents : An Examination of Firms That Marginally Miss or Beat Analyst Forecasts. The Journal of Finance, 64(5), 2361-2388.

Burgstahler, D., & Dichev, I. (1997). Earnings management to avoid earnings decreases and losses. Journal of Accounting and Economics, 24(1), 99–126.

Burgstahler, D., & Eames, M. (2006). Management of earnings and analysts’ forecasts to achieve zero and small positive earnings surprises. Journal of Business Finance and Accounting, 33(5–6), 633–652.

Chen, J. Z., Rees, L.L., & Sivaramakrishnan, K. (2015). Are All Benchmark Beaters Treated the Same? Accrual-Based Versus Real Earnings Management. Working paper, University of Colorado at Boulder, Texas A&M University, and Rice University.

Cohen, D., Dey, A., & Lys, T. Z. (2008). Real and accrual-based earnings management in the pre- and post-arbanes-Oxley periods. The Accounting Review, 83(3), 757–787.

Consioni, S., Colauto, R. D., & Lima, G. A. S. F. D. (2017). Voluntary disclosure and earnings management : evidence from the Brazilian capital market. Revista Contabilidade & Financas, 28(74), 249-263.

Cohen, D. A., & Zarowin, P. (2010). Accrual-based and real earnings management activities around seasoned equity offerings. Journal of Accounting and Economics, 50(1), 2-19.

Dechow, P. M., Kothari, S. P., & Watts, R. L. (1998). The relation between earnings and cash flows. Journal of Accounting and Economics, 25(2), 133–168.

Dechow, P., & Skinner, D. (2000). Earnings management: Reconciling the views of accounting academics, practitioners, and regulators. Accounting Horizons, 14(2), 235–250.

Dechow, P. M., & Dichev, I. D. (2002). The Quality of Accruals and Earnings: The Role of Accrual Estimation Errors. The Accounting Review, 77, 35-59.

Demski, J. S. (1998). Performance Measure Manipulation. Contemporary Accounting Research, 14, 261-285.

Demski, J. S. (2004). Endogenous Expectations. The Accounting Review, 79, 519-539.

Dhaliwal, D. S., Gleason, C. A., & Mills, L. F. (2004). Last-chance earnings management: using the tax expense to meet analysts’ forecasts. Contemporary Accounting Research, 21(2), 431–460.

Dichev, I. D., Graham, J. R., Harvey, C. R., & Rajgopal, S. (2013). Earnings quality: Evidence from the field. Journal of Accounting and Economics, 56(2–3), 1–33.

Erickson, M., & Wang, S. (1999). Earnings management by acquiring firms in stock for stock mergers. Journal of Accounting and Economics, 27(2), 149-176.

Ewert, R., & Wagenhofer, A. (2005). Economic effects of tightening accounting standards to restrict earnings management. The Accounting Review, 80(4), 1101-1124.

Graham, J., Harvey, C., & Rajgopal, S. (2005). The economic implications of corporate financial reporting. Journal of Accounting and Economics, 40, 3-73.

Gunny, K. A. (2010). The relation between earnings management using real activities manipulation and future performance: Evidence from meeting earnings benchmarks. Contemporary Accounting Research, 27(3), 855-888.

Healy, P. M., & Wahlen, J. M. (1999). A review of earnings management literature and its implications for standard setting. Accounting Horizons, 13, 365-383.

Jaggi, B., & Lee, P. (2002). Earnings management response to debt covenant violations and debt restructuring. Journal of Accounting, Auditing & Finance, 17(4), 295–324.

Järvinen, T., & Myllymäki, E. R. (2016). Real Earnings Management before and after Reporting SOX 404 Material Weakness, Accounting Horizons, 30(1), 119 - 141.

Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 3, 305-360.

Jo, H., & Kim, Y. (2007). Disclosure frequency and earnings management. Journal of Financial Economics, 84(2), 561-590.

Kasznik, R. (1999). On the association between voluntary disclosure and earnings management. Journal of Accounting Research, 37, 57–81.

McNichols, M. (2000). Research design issues in earnings management studies. Journal of Accounting and Public Policy, 19, 313–345.

McNichols, M. (2002). Discussion of the quality of accruals and earnings: The role of accrual estimation errors. The Accounting Review, 77, 61–69.

Robb, S. (1998). The Effect of Analysts’ Forecasts on Earnings Management in Financial Institutions, Journal of Financial Research, 21(3), 315-331.

Roychowdhury, S. (2006). Earnings management through real activities manipulation. Journal of Accounting and Economics, 42(3), 335-370.

Scholz, S. (2014). Financial Restatement Trends in the United States : 2003-2012. Retrieved March 22, 2019, from

Zang, A. Y. (2012). Evidence on the trade-off between real activities manipulation and accrual-based earnings management. The Accounting Review, 87(2), 675–703.

Zhao, Y., Chen, K. H., Zhang, Y., & Davis, M. (2012). Takeover protection and managerial myopia: Evidence from real earnings management. Journal of Accounting and Public Policy, 31(1), 109–135.




How to Cite

Vilalai, P. ., Petchchedchoo, P. . ., & Kumsuprom, S. . (2020). Real Earnings Management and Accrual-based Earnings Management Implications for Future Profitability. Journal of Accountancy and Management, 12(3), 83–96. Retrieved from



Research Articles