Earnings Management

Business, Legal & Accounting Glossary

Definition: Earnings Management


Earnings Management


Full Definition of Earnings Management


Manipulation of a company’s financial earnings either directly or through indirect accounting methods. This is more likely to occur when a company habitually is unable to meet investor expectations or in periods of volatile earnings. Earnings management is often considered materially misleading and thus a fraudulent activity. Even though the changes may follow all of the accounting standards and laws, they may go against what the standards and laws were originally trying to establish. For example, a change from FIFO to LIFO in inventory management may help a company’s financial ratios, but may not reflect the true value of its inventory. See creative accounting.


Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/earnings-management/
Modern Language Association (MLA):
Earnings Management. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
March 29, 2024 https://payrollheaven.com/define/earnings-management/.
Chicago Manual of Style (CMS):
Earnings Management. PayrollHeaven.com. Payroll & Accounting Heaven Ltd.
https://payrollheaven.com/define/earnings-management/ (accessed: March 29, 2024).
American Psychological Association (APA):
Earnings Management. PayrollHeaven.com. Retrieved March 29, 2024
, from PayrollHeaven.com website: https://payrollheaven.com/define/earnings-management/

Definition Sources


Definitions for Earnings Management are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 20th November, 2021 | 0 Views.