Does the Adoption of IAS/IFRS with a Strong Governance Mechanism Can Deter Earnings Management?

Abstract

The cascade of financiers and accountants scandals that marked the beginning of this decade has shed light on the quality of accounting and financial reporting published by companies. Faced with this dramatic situation, the European Union has sought to restore confidence between the different actors in the scene through the introduction of a new international accounting standard: IAS / IFRS. This study mainly aimed at verifying the impact of good governance mechanisms on earning management after the adoption of these new standards. Thus, using a sample of 145 French listed companies, the results affirm in part the theoretical findings. The implementation of good governance mechanisms has really narrowed the level of earning management after January 2005.