Acta Univ. Bohem. Merid. 2023, 26(2):68-79 | DOI: 10.32725/acta.2023.0092833

Accrual and Real Earnings Management: Firm Value Analysis

Saheed Akande Shittu1, Hakeem Olayinka Onifade2, Khairat Taiwo Ajibola3, Sherifdeen Olatunji Aminu3
1 Department of Accuntancy, Federal Polytechnic Ayede, Oyo State, Nigeria
2 Crescent University, Ogun State, Nigeria
3 Federal Polytechnic Ayede, Oyo State, Nigeria


The study examines the effect of accrual and Real Earnings Management (REM) on firm value of selected manufacturing firms in Nigeria. Tobin’s Q was employed to measure firm value, while Larcker and Richardson's (2004) and Roychowdhury's (2006) models were used to proxy accrual-based and REM respectively. Purposive sampling technique was employed to select thirty-seven (37) listed manufacturing firms across conglomerates, health care, industrial goods, and consumer goods sectors in Nigeria. Panel regression analysis employed to analyse secondary data gathered for the study. The results reveal a negative and significant influence of accrual-based, while REM has a positive and significant influence on firm value of selected listed manufacturing firms in Nigeria. The study concludes that earnings management has a significant effect on firm value of manufacturing firms in Nigeria. The study recommends that REM be used only when absolutely necessary for the companies’ survival and success. 

Keywords: Accrual, real earnings management, manufacturing firms, firm value, Nigeria
JEL classification: R30, R39

Accepted: November 8, 2023; Published: November 10, 2023  Show citation

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Shittu, S.A., Olayinka Onifade, H., Ajibola, K.T., & Aminu, S.O. (2023). Accrual and Real Earnings Management: Firm Value Analysis. Acta Universitatis Bohemiae Meridionalis, 26(2), 68-79. doi: 10.32725/acta.2023.009
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