隨著企業營運規模持續擴大，高階管理階層的經營績效便容易成為各方關注的焦點，依DeAngelo(1988)提出的論點，外部競爭者常會以企業盈餘不佳為由攻擊現任管理階層，而現任管理當局為保衛對企業之經營權，常會藉由操弄盈餘的方式美化其經營績效，因此，經營績效與盈餘管理可謂息息相關。此外，以往學者對於高階管理階層異動議題多聚焦於與公司績效間關聯性，研究結論並無一致，一派學者認為當公司經營績效下降時，公司會以更換高階管理階層方式來提昇績效；而另一派學者則認為當公司更換高階管理階層後，反而會導效公司經營績效滑落，因為繼任者會有洗大澡(Take a bath)的盈餘管理現象。本研究於高階管理階層異動該項變數與盈餘管理具相關性時，將進一步分析高階管理階層異動與否之樣本銀行於各構面之差異性，並觀察其內部股權結構變化及外部監督機制是否能有效發揮。
The research focuses on three dimensions of earnings management motivations in banking, bank’s internal correlation and external monitoring mechanisms to explore whether senior management involves in earnings management with discretionary bad debts or Securities Gain and Loss which are common in earnings management in banking industry. The study covers 24 domestic TWSE (OTC) listed banks and banks under financial holding companies from 1999 to 2008.
As operation is getting larger and larger, performance of senior management tends to be the focus of all people. According to DeAngelo (1988), outside competitors often attack current senior management with poor profits. To defend the operation right, current senior management manipulates earnings management to make the performance better. Thus, business performance is closely related to earnings management. In the past, domestic and foreign scholars focused on business performance in issues of senior management changes. The conclusions are not consistent. One school of scholars believe, when business performance worsens, companies change senior management to enhance performance; the other hold that change of senior management only result in worse performance, as successors take a bath earnings management. This study intends to make further analysis of the differences in every dimension in the sample banks that have senior management change or not, when the variable “senior management change” has correlation with “earnings management.” also, it intends to observe whether the changes of the banks’ internal shareholding structure and their external monitoring mechanism can be exerted effectively or not.
The evidence-based results have shown: (1) Dimension of the motivation for earnings management in banking: Senior management really engages in earnings management with discretionary bad debts or Securities Gain and Loss — the two commonly-applied tools for earnings management in banking; there are four variables — stock repurchase, cash increment, income smoothing, and senior management changes — similar to the ones in related literatures and the anticipations in this study’s hypothesis. However, the variable conforming to BIS is contrary to the ones in related literatures and the anticipations, perhaps because the BIS in the sample banks have exceeded the thresholds of laws and regulations and are higher; hence, senior management will have the motivation for engaging in earnings management to reduce the excessive BIS. (2) Dimension of bank’s internal correlation: When the sample banks are members of financial holding, each subsidiary is able to own and share many more resources, so that senior management tends to engage in earnings management by utilizing such an advantage. Besides, although senior management is usually from backgrounds of family members and they may not be replaced due to poor performance, however, according to evidence-based results, even though parts of the sample banks are from backgrounds of family members, they were dismissed from office due to cases or they were merged due to poor business performance. Therefore, even though the management is from backgrounds of family members, they still may be replaced unavoidably. (3) Dimension of external Monitoring mechanism: When the sample bank has higher ratio of government shareholding, the representatives of government shareholding will intervene the board of directors more profoundly and they will be more capable to inhibit the management from engaging in earnings management. When it has higher pledged shares ratio of directors’ and supervisors’ shareholdings, it will earn much more attention from financial Monitoring institutions and the social public, so that the degree of earnings management in the bank that has higher pledged shares ratio of directors’ and supervisors’ shareholdings will descend, instead of rising.
Besides, this study has made further exploration of the differences between years of senior management change and earnings management. The evidence-based results have shown: In terms of the sample banks that have many more directors or higher ratios of government shareholding, they can really exert their external monitoring functions in the years without senior management change, able to effectively inhibit senior management from engaging in earnings management.