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Analysis Study Research Paper | Finance | India | Volume 11 Issue 6, June 2022 | Rating: 4.3 / 10

Research on Earnings Management under IFRS Framework

Gao Jun

Abstract: International Financial Reporting Standards (hereinafter referred to as IFRS) which was developed by IASB have made tremendous contributions to the convergence of global accounting standards. IFRS aims at developing one set of transparent and efficient accounting standards to be used for both domestic and cross - border companies to improve financial reporting quality. However, since IFRS is a principles - based approach, it allows more flexibility for management to make decisions (Leuz, C, 2010). Therefore, companies can make earnings management under the current IFRS framework with a variety of motivations, such as tax avoidance. The purpose of the paper is to study the history of IFRS and explain its advantages brought to global capital markets, as well as the issues arising from earnings management, especially for the sake of tax avoidance. Furthermore, the paper will review some justifications for earnings management, and discuss its eligibility under IFRS.

Keywords: International Financial Reporting Standards; Earning Management; Financial Management; Tax Avoidance

Edition: Volume 11 Issue 6, June 2022,

Pages: 1617 - 1622