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Article
Publication date: 1 July 2011

Tang Yuejun

The purpose of this paper is to empirically analyze the impacts of motivation for avoiding loss and actual abnormal audit fees on management behaviors of audit opinion shopping.

Abstract

Purpose

The purpose of this paper is to empirically analyze the impacts of motivation for avoiding loss and actual abnormal audit fees on management behaviors of audit opinion shopping.

Design/methodology/approach

Using empirical research methods, this study employs regressive models and moderating effect models with data from Chinese listed companies from 2001 to 2008.

Findings

By analyzing the empirical data, it is found that strong motivation for avoiding loss has a certain moderating effect on the relationship between abnormal audit fees and audit opinion shopping; abnormal descent of audit fees significantly increases both the likelihood of receiving modified audit opinions of annual financial reports and that of the improvement of audit opinions; listed companies reporting consecutive losses in the last two years have a higher likelihood of an improvement in unfavorable audit opinions because of stronger motivation for avoiding loss and audit opinion shopping of management; and strong motivation for avoiding loss has a significant moderating effect on the relationship between abnormal increase of audit fees and audit opinion shopping.

Practical implications

This study has a significant practical implication for market supervisors, small and medium investors.

Originality/value

The paper classifies abnormal audit fees into abnormal increase and descent of audit fees, and audit opinions differences into the improvement and deterioration of audit opinions, and further empirically analyzes and verifies the moderating effect of motivation for avoiding loss on the relationship between abnormal audit fees and audit opinion shopping.

Details

China Finance Review International, vol. 1 no. 3
Type: Research Article
ISSN: 2044-1398

Keywords

Article
Publication date: 10 August 2015

Shaista Wasiuzzaman, Iman Sahafzadeh and Niloufar - Rezaie Nejad

This paper aims to detect earnings management activity in different industries in Malaysia by using the earnings distribution model. Further, the prospect theory and the…

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Abstract

Purpose

This paper aims to detect earnings management activity in different industries in Malaysia by using the earnings distribution model. Further, the prospect theory and the possible influence of various industry variables are tested to understand the role of the industry in the motivation to manage earnings among firms in Malaysia.

Design/methodology/approach

A sample of 538 firms from 15 different industries over the years 2005-2011 is used for this purpose. The earnings distribution model is used to detect earnings management activity across industries, and various regression techniques are used to test the influence of the prospect theory and various industry variables on earnings management activity.

Findings

The findings indicate the presence of earnings management practices in Malaysian industries, but the prevalence of earnings management activity and the motivation to do so are found to differ across industries. The prospect theory is found to be a possible motivation for earnings management overall but not when industries are considered separately. Industry competitiveness, capital intensity and profitability are found to influence both motivations to manage earnings while industry leverage is found significant only in the case of motivation to manage earnings to avoid reporting losses. Finally, earnings volatility and size are insignificant in influencing the propensity to manage earnings.

Originality/value

To the authors’ knowledge, this is the first study which documents the role of various industry characteristics in influencing earnings management activity. It highlights the importance of considering industry level variables in a study on earnings management and, hence, adds to the growing literature on earnings management.

Details

Review of Accounting and Finance, vol. 14 no. 3
Type: Research Article
ISSN: 1475-7702

Keywords

Article
Publication date: 2 February 2015

Murya Habbash and Salim Alghamdi

– The primary purpose of this paper is to investigate the motivations of earnings management in less-developed economy using Saudi listed companies.

1991

Abstract

Purpose

The primary purpose of this paper is to investigate the motivations of earnings management in less-developed economy using Saudi listed companies.

Design/methodology/approach

While numerous motivations for earnings management are proposed in the literature, many of these motivations have inconsistent empirical support. A number of studies report discontinuities in the distribution of earnings around benchmarks such as the zero profit level. However, the evidence regarding whether these discontinuities are associated with earnings management behaviour is still uncertain. In addition, evidence regarding the ability of various governance mechanisms to constrain earnings management is also mixed. These issues raise the necessity to investigate managers behaviour that incentivise earnings management practices through qualitative research approach. A questionnaire survey and interviews are mainly used to explore the motivations for earnings management in Saudi Arabia in order to obtain the different perceptions of respondents.

Findings

The findings reveal that the four main incentives for Saudi managers to manage earnings are “to increase the amount of remuneration”, “to report a reasonable profit and avoid loss”, “to obtain a bank loan” and “to increase share price”.

Research limitations/implications

Hence, agency-institutional theory may provide a sensible explanation for earnings management practices in Saudi Arabia.

Practical implications

Previous findings could be helpful for external auditors and regulators and legislators in their attempts to constrain the incidence of earnings management and enhance the quality of monitoring mechanisms.

Originality/value

While numerous motivations for earnings management are proposed in the literature, many of these motivations have inconsistent empirical support. A number of studies report discontinuities in the distribution of earnings around benchmarks such as the zero profit level. However, there is no evidence that these discontinuities are associated with earnings management behaviour. In addition, evidence regarding the ability of various governance mechanisms to constrain earnings management is also mixed. These issues raise the necessity to investigate managers behaviour that incentivise earnings management practices through qualitative research approach.

Details

Journal of Accounting in Emerging Economies, vol. 5 no. 1
Type: Research Article
ISSN: 2042-1168

Keywords

Article
Publication date: 12 September 2017

Wenxia Guo and Kelley Main

Adaptive selling can help build positive relationships between salespeople and consumers. The literature shows that consumers respond positively to salespeople under…

1025

Abstract

Purpose

Adaptive selling can help build positive relationships between salespeople and consumers. The literature shows that consumers respond positively to salespeople under approach but not avoidance motivations. This paper aims to demonstrate a circumstance under which consumers with avoidance motivations can also respond positively, something not previously shown in the literature.

Design/methodology/approach

This research paper uses three experimental between-subject designs to test hypotheses.

Findings

The current research identifies appropriate sales influence tactics (e.g. a customer-autonomy-oriented or a loss-avoidance-oriented influence tactic) where consumers with avoidance motivations can also respond to sales agents positively by the evidence of higher purchase intentions. In addition, this research shows that consumers with approach motivations may not always respond positively to salespeople. Further, goal facilitation appraisals of the salespeople serve as a mechanism between consumers’ shopping motivations and their behavioral responses (e.g. purchase intentions).

Originality/value

First, while the previous literature demonstrates that approach motivations generally lead to more positive effects (Elliot and Trash, 2002), this research indicates that avoidance motivations can also have positive effects, which is a finding that has not been demonstrated in the literature thus far. Second, this research identifies goal facilitation appraisals as one underlying process that explains the interactive effect between matching influence tactics and consumers’ approach/avoidance motivations when shopping. Third, the authors integrate regulatory focus theory by using gain- or loss-avoidance-oriented sales influence tactics to match approach and avoidance motivations.

Details

European Journal of Marketing, vol. 51 no. 9/10
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 3 April 2019

Peter Elsborg, Johan Bundgaard Nielsen, Gertrud Ursula Pfister, Vivian Dümer, Anette Jacobsen and Anne-Marie Elbe

The purpose of this paper is to explore how the psychological constructs volition and motivation influence successful and unsuccessful weight maintainers’ experiences…

Abstract

Purpose

The purpose of this paper is to explore how the psychological constructs volition and motivation influence successful and unsuccessful weight maintainers’ experiences during the difficult period following an intensive lifestyle intervention.

Design/methodology/approach

Post lifestyle intervention semi-structured interviews with 11 successful and four unsuccessful weight maintainers were conducted.

Findings

The eight themes that emerged and the differences between successful and unsuccessful maintainers were theoretically explained applying the self-determination theory (motivation) and the personal systems interaction (volition).

Practical implications

The study validates and coheres with previous findings on the importance of self-regulation and autonomous motivation for weight loss maintenance. Additionally, the study’s findings expand the literature by explaining both empirically and theoretically how the quality of motivation concerning an activity influences the level of volitional intensity needed when wanting to either engage in goal oriented or refrain from goal opposing activities.

Originality/value

Developing effective obesity interventions has become essential, as obesity is a growing health threat in most countries in the world. However, there is a gap in the literature with regards to qualitative psychological studies with a clear theoretical framework informing intervention development.

Details

Health Education, vol. 119 no. 2
Type: Research Article
ISSN: 0965-4283

Keywords

Abstract

Details

The Emerald Review of Industrial and Organizational Psychology
Type: Book
ISBN: 978-1-78743-786-9

Article
Publication date: 1 April 2021

Selim Aren, Hatice Nayman Hamamci and Safvan Özcan

The aim of this study, the moderating effect of pleasure-seeking and loss aversion, was investigated in relation to the big five personality traits with regard to risky…

Abstract

Purpose

The aim of this study, the moderating effect of pleasure-seeking and loss aversion, was investigated in relation to the big five personality traits with regard to risky investment intentions.

Design/methodology/approach

In the study, the data was obtained between January and November 2019 via an online survey with convenience sampling. The total number of subjects is 886. The authors used IBM SPSS Statistics for analysis. Exploratory factor analysis, correlation analysis, regression analysis and discriminant analysis were performed.

Findings

Significant relationships were found between five personality traits and risky investment intentions. In these relationships, the moderator effect of pleasure-seeking for extraversion, conscientiousness and neuroticism personality traits was also determined. Besides, investment preferences for choosing “unknown and new investment” against “known and experienced investment”, which is a typical feature of the balloon periods, were modeled with big five personality traits and motivation variables (pleasure-seeking and loss aversion) and the equation was formed. As a result, high accuracy classification success was obtained.

Originality/value

The study is unique owing to its findings. In addition, general risk aversion and risky investment intention were investigated simultaneously to explain the different findings in the literature regarding the attitude of big five personality traits to risk and personality traits that show consistent approach were identified.

Details

Kybernetes, vol. 50 no. 12
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 30 August 2019

Liang Wang, Tingjia Xu and Jie Chen

The purpose of this paper is to study the decision-making behavior of the initiator and the participant under innovative and project-based tasks, respectively. It further…

Abstract

Purpose

The purpose of this paper is to study the decision-making behavior of the initiator and the participant under innovative and project-based tasks, respectively. It further explores the impact of the participant’s loss aversion and the initiator’s incentive level on the participant’s optimal effort level to reveal the implicit managerial mechanism.

Design/methodology/approach

This paper uses the Principal-agent Theory, Prospect Theory and Game Theory to study the decision-making behavior in crowdsourcing tasks. First, according to the return at the reference point, it establishes the utility function models of the participant and the initiator. Second, based on diverse loss aversion coefficient and incentive coefficient, it constructs the decision-making models of two types of task respectively. Third, it verifies the validity of models through simulation analysis.

Findings

For innovative task, the participant’s optimal effort level increases with the increment of loss aversion and incentive level, but decreases with the increase of his effort cost. For project-based task, the participant’s optimal effort level rises with the decrease of loss aversion; if the initiator does not take appropriate incentives, information asymmetry will lead to the task becoming a low-level innovation approach. Moreover, under innovative task, when the participant has loss aversion (or loss aversion reversal), his optimal effort level is higher (or lower) than that with no loss aversion, while the result under project-based task is just the opposite.

Originality/value

This paper characterizes two types of crowdsourcing task. Based on the prospect theory, it develops the decision-making models of the participant and the initiator under innovative and project-based tasks, thus exploring the impact of loss aversion and incentive level on their decision-making behavior. According to the findings in this paper, the initiator may effectively speculate the participant’s effort level and adopt reasonable monetary incentive measures to optimize the crowdsourcing return. In addition, this study can provide some reference for the design of incentive mechanism in crowdsourcing tasks and improve the relevant research of crowdsourcing.

Details

Kybernetes, vol. 49 no. 5
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 23 March 2010

Manuel London

This paper aims to examine characteristics that contribute to leaders' emergence and development as social advocates in their organizations and communities.

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Abstract

Purpose

This paper aims to examine characteristics that contribute to leaders' emergence and development as social advocates in their organizations and communities.

Design/methodology/approach

Building on theories of social problems, influence, and impression management, this paper examines how advocacy is affected by needs and situational conditions. Advocacy is the act of supporting an idea, need, person, or group. Advocates use cognitive, emotional, and behavioral strategies to influence attitudes, behaviors, and/or decisions for the benefit of individuals or to promote organizational change and/or social welfare. Social advocacy occurs within organizations in the form of corporate social responsibility, and it occurs within communities in the form of social entrepreneurship.

Findings

This theoretical paper argues that motivation of leaders of social ventures is a function of their conviction, self‐confidence, and extroversion. Advocates' beliefs about people are likely to shape their advocacy strategies, in particular, their beliefs about whether people are likely to change their attitudes and behavior, are sensitive to possible losses and gain, and respond to information about the probabilities and outcomes of actions and events. Advocate's resilience and transformational abilities (communications and political skills, knowledge of change management, and learning orientation) are predicted to influence their success.

Originality/value

The paper discusses directions for management development research and practice to promote involvement in social ventures.

Details

Journal of Management Development, vol. 29 no. 3
Type: Research Article
ISSN: 0262-1711

Keywords

Article
Publication date: 1 January 1997

Bernhard F.J. Borges and Jack L. Knetsch

Reports the results of two experimental tests of the extent to which the large disparity between people’s valuation of gains and losses, and related fairness…

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Abstract

Reports the results of two experimental tests of the extent to which the large disparity between people’s valuation of gains and losses, and related fairness determinations, are used in judging the acceptability of alternative negotiating or conflict resolution proposals. Participants acted as arbitrators and selected their preferred resolution of conflicts, involving either the division of gains or sharing responsibility for losses. Different cases were presented in which one or the other party incurred varied combinations of direct or opportunity costs, or received varied forms of payments. Contrary to conventional economic assumptions, but consistent with earlier behavioural findings, direct costs incurred by one party to the negotiation were far more important than opportunity costs in setting the terms of a more acceptable resolution. The results strongly suggest that recent behavioural findings might be used to improve the design of negotiating and conflict resolution proposals.

Details

International Journal of Social Economics, vol. 24 no. 1/2/3
Type: Research Article
ISSN: 0306-8293

Keywords

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