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Earnings management and seasoned private equity placements : Evidence from U.S. and Japanese issuers

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Item Summary

Title:Earnings management and seasoned private equity placements : Evidence from U.S. and Japanese issuers
Authors:He, Daoping
Date Issued:2008
Abstract:Seasoned private equity placement is an important vehicle by which public firms obtain equity financing. This study seeks to accomplish three goals regarding the issuance of private placements: (1) to investigate managers' earnings manipulation behavior of U.S. issuers around the time of the issuance; (2) to examine whether such earnings manipulation behavior helps explain the long-term post-issue stock underperformance; and (3) to provide further evidence from Japanese private placement issuers regarding the pattern of earnings management around the time of issuance and the extent to which it can explain the post-issue stock underperformance. The results show that managers of U.S. private placement issuers tend to engage in income-increasing earnings management around the time of the issuance and the income-increasing accounting accruals made at the time of private placements predict the post-issue stock underperformance. The study also finds that, similar to their U.S. counterparts, Japanese managers tend to report inflated earnings around the time of private placements issuance and the earnings management by Japanese private placement issuers in the year of issuance predicts the firm's post-issue stock underperformance.
Description:Thesis (Ph.D.)--University of Hawaii at Manoa, 2008.
Seasoned private equity placement is an important vehicle by which public firms obtain equity financing. This study seeks to accomplish three goals regarding the issuance of private placements: (1) to investigate managers' earnings manipulation behavior of U.S. issuers around the time of the issuance; (2) to examine whether such earnings manipulation behavior helps explain the long-term post-issue stock underperformance; and (3) to provide further evidence from Japanese private placement issuers regarding the pattern of earnings management around the time of issuance and the extent to which it can explain the post-issue stock underperformance. The results show that managers of U.S. private placement issuers tend to engage in income-increasing earnings management around the time of the issuance and the income-increasing accounting accruals made at the time of private placements predict the post-issue stock underperformance. The study also finds that, similar to their U.S. counterparts, Japanese managers tend to report inflated earnings around the time of private placements issuance and the earnings management by Japanese private placement issuers in the year of issuance predicts the firm's post-issue stock underperformance.
Includes bibliographical references (leaves xxx-xxx).
Also available by subscription via World Wide Web
82 leaves, bound 29 cm
URI:http://hdl.handle.net/10125/20643
ISBN:9780549780755
Rights:All UHM dissertations and theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission from the copyright owner.
Appears in Collections: Ph.D. - International Management


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