Study on the Factors that Influence the Degree of Management of the Financial Earnings Reported by BSE-Quoted Companies

The quality of the financial information published by the economic entities is a determining element for the efficiency of individual investment as well as for the stability of the capital markets in general. The existence of a set of motivational factors concerning the earnings management generates intense concerns for the users about the credibility of the information synthesised in the financial statements. The diversity of the features that individualise the reporting entities is a limitation to the unitary evaluation of the quality level of the transmitted information. The present paper aims to analyse, by resorting to financial and non-financial information (activity field, reputation of the audit company, expressed opinion, structure of the shareholders, type of control applied, nationality of the capital), characteristic to the companies quoted on the main section of the Bucharest Stock Exchange (BSE), to analyse the neutrality of the published information, quantified through the extent of earnings management. The data extracted from the financial statements published by the 62 companies included in the study for the last four fiscal years (2010-2013) facilitated performing 248 observations on the features (variables) associated to the analysis of the mentioned phenomenon.