Variable remuneration before mandate time is the cause of opportunism of CEOs? Evidence of earnings management in Brazil

Authors

DOI:

https://doi.org/10.4025/enfoque.v38i3.42193

Abstract

This research verified the influence of variable remuneration on the relationship between CEOs term time and earnings management practices, as well as the mitigating effect generated by corporate governance mechanisms. The sample comprised 195 Brazilian companies. The results indicate that the last year of the CEOs mandate is decisive for the practice of earnings management, both for accounting choices and for operational decisions. However, it was found that the long-term CEOs do not present intentions to earnings management by the accounting choices, and in operational decisions their intentions are to report more conservative results. It was concluded that the variable remuneration had no effect on the relationship between the term of the CEOs term and the earnings management by the accounting choices. However, for management by operational decisions, variable remuneration had an effect on the intentions of CEOs with a long mandate, further reducing their intensions as the share of variable remuneration increased.

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Author Biographies

  • Cristian Baú Dal Magro, Universidade da Região de Chapecó - Unochapecó

    Professor de Graduação em Ciências Contábeis pela Universidade da Região de Chapecó - Unochapecó

    Doutor em Ciências Contábeis e Administração - FURB

  • Andreia Carpes Dani, Universidade Regional de Blumenau - FURB

    Doutoranda em Ciências Contábeis e Administração - FURB

  • Roberto Carlos Klann, Universidade Regional de Blumenau - FURB

    Doutor em Ciências Contábeis e Administração - FURB

    Professor do Programa de Pós-Graduação em Ciências Contábeis da Universidade Regional de Blumenau - FURB

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Published

2019-10-18

Issue

Vol. 38 No. 3 (2019): Enf.: Ref. Cont.

Section

Original Articles

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How to Cite

Dal Magro, C. B., Dani, A. C., & Klann, R. C. (2019). Variable remuneration before mandate time is the cause of opportunism of CEOs? Evidence of earnings management in Brazil. Enfoque: Reflexão Contábil, 38(3), 77-92. https://doi.org/10.4025/enfoque.v38i3.42193