Earning Management Essay Example | Topics and Well Written Essays - 750 words

Earning Management - try ExampleIn addition, key defense in the financial management is full disclosure. This implies that if all the tuition available for positional analysis of a company is available and true, analysts are able to provide seasonable and effective advisory information for a company. However, when a company decides to provide fraudulent information to elaboration investors preference and stakeholders favors, the companies end up being overwhelmed with deceptive information and at last lose the truly thing they bugger off been fighting to win (Temte, 2005). To increase the quality of financial reporting and hence the credibleness of the information contained therein, there must be some ethical consideration. This implies that it is unethical for any company to advisedly and inappropriately conceal information that would change the financial image of a company.Further, honesty has always been considered the outstrip policy, especially in business. Companies tha t undertake earning management are doing nothing less than dishonesty. The use of deferring maintenance to smear positive image does not mean that the deferred activities are not to be undertaken. What happens is that the deferred activities will I the capacious run cost the company a fortune (Vataliya, 2009). And since the company made investors and analysts believe that it is doing well financially through fraudulent data, then the company loses all that it has sought to save. The investors and stakeholders, therefore, feel deceived and that a company they have depended on has been dishonest.