The Effect of Culture on Earnings Management: A COVID-19 Case Study

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dc.contributor.advisorReimsbach, Daniel
dc.contributor.advisorBraam, Geert
dc.contributor.authorLiu, Sarina
dc.date.issued2022-12-20
dc.description.abstractPurpose: This thesis investigates the effect the COVID-19 pandemic has on the relationship between Hofstede’s cultural dimensions and the magnitude of accrual-based earnings management. Design/methodology/approach: After the outbreak of the COVID-19 pandemic, numerous companies experienced a significant reduction in demand. Consequently, the performance of these companies were affected by this. This thesis investigates the effect of culture on earnings management during the COVID-19 pandemic for listed companies domiciled in the European Union. To this end, two ordinary least squares (OLS) regressions are run to analyze the effect of Hofstede’s two cultural dimensions, uncertainty avoidance and individualism, on accrual-based earnings management during the pre-pandemic period (2018-2019) and the pandemic period (2020-2021). Findings: This study finds that individualism and uncertainty avoidance are both positively associated with the magnitude of accrual-based earnings management. Moreover, the study concludes that the effect of cultural values during the pandemic is indifferent from the effect of the cultural values individualism and uncertainty avoidance prior to the pandemic. Keywords: Earnings Management, COVID-19 crisis, pandemic, Hofstede’s cultural dimensions
dc.identifier.urihttps://theses.ubn.ru.nl/handle/123456789/14517
dc.language.isoen
dc.thesis.facultyFaculteit der Managementwetenschappen
dc.thesis.specialisationspecialisations::Faculteit der Managementwetenschappen::Master Economics::Corporate Finance & Control
dc.thesis.studyprogrammestudyprogrammes::Faculteit der Managementwetenschappen::Master Economics
dc.thesis.typeMaster
dc.titleThe Effect of Culture on Earnings Management: A COVID-19 Case Study
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