Earnings Management in Family Firms: Current State of Knowledge and Opportunities for Future Research

Review of Accounting and Finance, 15(1), pp. 85-100, 2016

Posted: 1 Jan 2014 Last revised: 24 Jul 2016

See all articles by Inna Paiva

Inna Paiva

ISCTE-IUL

Isabel Lourenço

Lisbon University Institute (ISCTE-IUL); University of São Paulo (USP)

Manuel Castelo Branco

University of Porto - Faculty of Economics

Date Written: December 30, 2013

Abstract

This paper synthesizes the extant research on earnings management in family firms. It reviews the current state of knowledge about this phenomenon, identifying the main theoretical frameworks used in the empirical research on the topic, as well as the main types of said research and its findings.

Agency theory is identified as the main theoretical framework used. Two major types of research identified in the literature are discussed, namely earnings management in family firms versus non-family firms, and (2) earnings management in different types of family firms. Important research gaps are identified, and future research priorities are suggested. These pertain to the lack of research on earnings management in non-listed family firms and analyzing the realities of less developed countries, as well as the importance of using theoretical frameworks batter able to capture the peculiarities of family firms.

Suggested Citation

Paiva, Inna and Lourenço, Isabel and Branco, Manuel Castelo, Earnings Management in Family Firms: Current State of Knowledge and Opportunities for Future Research (December 30, 2013). Review of Accounting and Finance, 15(1), pp. 85-100, 2016 , Available at SSRN: https://ssrn.com/abstract=2373122 or http://dx.doi.org/10.2139/ssrn.2373122

Inna Paiva

ISCTE-IUL ( email )

Av. das Forças Armadas
Lisboa, 1649-026
Portugal

Isabel Lourenço (Contact Author)

Lisbon University Institute (ISCTE-IUL) ( email )

Complexo Indeg/Iscte
Av. Professor Anibal Bettencourt
Lisbon, 1600-189
Portugal

University of São Paulo (USP) ( email )

Brazil

Manuel Castelo Branco

University of Porto - Faculty of Economics ( email )

Rua Roberto Frias
s/n
4200-464 Porto, 4200-464
Portugal

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