Firm diversification and earnings management: Evidence from seasoned equity offerings

• Main Authors: LIM, Chee Yeow, THONG, Tiong Yang, Ding, David K.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2008
• Subjects: Finance and Financial Management; Portfolio and Security Analysis
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/1143; https://ink.library.smu.edu.sg/context/lkcsb_research/article/2142/viewcontent/Firm_diversification_Earnings.pdf
• Institution: Singapore Management University

Popular press suggests that diversified firms are more aggressive in managing earnings than non-diversified firms. We examine this claim in the seasoned equity offering (SEO) setting, where firms have been shown to have the incentive to manage earnings upwards. Using the cross-sectional modified Jon...