The Relationship between Earnings Management and Ownership Structure - Evidence from Mongolian Listed Firms Undral Erdenee (a*), Narantsetseg Amarsanaa (b)
a) Department of Accounting and Analysis, Mandakh University, Mongolia
*undral[at]mandakh.edu.mn
b) Department of Accounting and Analysis, Mandakh University, Mongolia
Abstract
This paper analyses the relationship between earnings management and ownership structure in Mongolia. The corporate governance in Mongolia is characterized by the prominence of major shareholders, who frequently exert significant influence over managerial decisions. Thus, the main purpose of this study is to investigate how the company^s ownership structure influences earnings management. According to prior studies, ownership structure has a significant impact on earnings management. Discretionary accruals were used to measure earnings management. We found that foreign ownership negatively affects earnings management by analyzing data of 80 non-financial companies listed on Mongolian stock exchange, the degree of ownership concentration, managerial ownership, government ownership and institutional ownership do not affect earnings management. Moreover, among control variables, financial performance positively affects earnings management.
