盈余管理的时间和误区

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1、,CLICK RO EDIT MASTER TITLE STYLE,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,*,Earnings Management:Practice and Pitfalls,Philip Livingston,President and CEO,Financial Executives International,What is Earnings Management?,The process of establishingstakeholder

2、expectations and achieving the result through legitimate,and/or,illegitimate methods,Why Are We Talking About It?,Illegitimate methods CLOUD financial reporting transparency,Contrary to unbiased reporting,Result is low quality earnings even if the target is reached.,U.S.capital markets placed a prem

3、ium on predictability,SEC action in 1998,Legitimate Earnings Management,Planning discretionary spending,Marketing and advertising,Research and development,Employee meetings,T&E,Legitimate Earnings Management,Special Quarter-End Sales,Price reductions,Sales force incentives,Quantity/truckload offers

4、to customers,Shipments Hold or Push,Daily management of revenue,Add warehouse workers,Schedule factory and warehouse overtime,Legitimate Earnings Management,Instituting a hiring freeze,temporarily avoiding:,Hiring expense,Non-essential salary expense,Benefit costs,Top Problem Area,Revenue accounting

5、 manipulation,Side deals by salespeople that are undisclosed to,accounting allowances,deductions and credits.,Shipments to distributors or intermediaries associated,with great uncertainty of sale.,Premature recording when right of return exists,Payment contingencies tied to other events,Invoices tha

6、t are inconsistent with underlying transactions,“,Managing the Bottom Line”Past Accounting Practices,Merger and Acquisition Reserve Abuses,Setting up reserves to cover future operating costs of an acquired company,Providing rich reserves that allow for future adjustments that favorably impact earnin

7、gs,Writing-off excessive“in-process R&D”to avoid future amortization charges,“,Managing the Bottom Line”Past Accounting Practices,Restructuring Reserve Abuses,Providing general restructuring reserves subject to subsequent adjustment,Reserving for exit costs that will benefit future periods(employee

8、moving and training),Including in the restructure charge the cost of assets already impaired,“,Managing the Bottom Line”Past Accounting Practices,Materiality Abuses,Exclusive reliance on“rule of thumb”criteria(e.g.5%of earnings)for determining materiality,Intentional failure to record items deemed“i

9、mmaterial”per these criteria,Improperly Aggregating and Netting unrecorded adjustments,Judgment Areas Subject to Abuse,Adjusting Reserves and Accruals on a Quarterly Basis,Those that require considerable judgment:,Inventory obsolesce and valuation,Sales returns and allowances,Accruals for profession

10、al fees,Accrued marketing costs,Warranty claim reserves,Reserves for self-insured benefits,Judgment Areas Subject to Abuse,Adjusting Reserves and Accruals on a Quarterly Basis,Those that require considerable judgment:,Bad debt allowance,Inventory overhead absorption rates,Tax rate,Prepaid expenses,S

11、EC Actions:SAB#99,Materiality,Requires consideration of QUALITATIVE factors,not just quantitative,“Is it probably that the judgment of a reasonable person relying upon the report would have been changed or influenced by correction of the item?”,Strives to eliminate INTENTIONAL failure to record imma

12、terial items,Requires consideration of the materiality of misstatements individually,and in aggregate,SEC Actions:SAB#100,Restructuring and Impairment Charges,Prior to recording a restructuring,companies must:,Have a detailed plan,approved by top management,Communicate to employees their benefits en

13、titlement,Disclose expected headcount reductions,timetable for plan execution,and expected cost by category,Report in detail,progress against the plan,Managing Earnings Expectations:Past Practices,Informal discussions with select analysts intended to influence earnings estimates,“Tipping”selected an

14、alysts in anticipation of earnings releases,Exchanging tipped information in exchange for agreement to“rein in”market expectations,Regulation FD“Fair Disclosure”,Whenever a company discloses material information,it must make public,Whenever non-intentional disclosure is made,the company must make it

15、 public within 24 hours.,Public disclosure includes,filing the information with the SEC,press release,providing public access to the conference call or meeting,Best Practices Going Forward,Stick to legitimate“operational”solutions,Make earnings forecasts public,Update forecasts regularly,Consider pr

16、oviding an earnings estimate range,Discuss short-term forecast within the context of long-term plans,Financial Executives InternationalInternet Community,www.,fei,.org,FEI Express e Newsletter,On-line Job Postings,Models and Presentations,On-line Membership Application,Download archive/teleconference playback,Conferences,Webcasts,and Magazine,Earnings Management:Practices and Pitfalls,Philip Livingston,President and CEO,Financial Executives International,