The Impact of Management Compensation on Earnings Management: Evidence from Pakistan Stock Exchange
Abstract
Keeping in view the increasing Complexity of businesses, this study investigates the effect of Management Compensation on Earnings management. The major objective of this research is to investigate one of the motivations that could encourage managers to manage the accounting results, namely the managerial compensation which includes fixed salary, bonuses and stock options. The sample consists of the 110 companies listed at Pakistan stock exchange from 2004-2014. The results of the study explored that there is significant positive effect of Management compensation on earning management. The study contributes to the literature regarding the effects of Management Compensation on earnings management in Pakistan.
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