Analyst following,financial constraint,and audit opinion shopping: From the perspective of earning management |
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| Authors: | Zhijun Lin Longmei Wang |
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| Institution: | School of Business, Macau University of Science and Technology, Taipa, Macao |
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| Abstract: | This study examines the relationships among analyst following, financial constraint, and audit opinion shopping from the perspective of earnings management, taking a sample of Chinese A-share firms from 2008 to 2018. We find that analyst following alleviates firm's accrued earnings management activities which restrain opinion shopping behaviors; on the other hand, it prompts real earnings management activities that encourage firm's effort to audit opinion shopping. Earnings management has a mediation effect on the positive association between analyst following and audit opinion shopping. Corporate financial constraint amplifies the positive effect of analyst following on opinion shopping. |
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| Keywords: | analyst following audit opinion shopping earning management financial constraint internal control |
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