Which of the following best describes earnings management?

Question

Quizplus · Accepted Answer

Earnings management refers to the process of selecting accounting policies that satisfy the objectives of the managers, often with the intent of manipulating financial results to meet or exceed certain expectations. It can involve legitimate activities such as choosing between alternative accounting methods, but can also involve unethical practices such as intentional misrepresentation of financial data. A and B involve fraudulent activities, whereas D refers to maintaining policies preferred by stakeholders, and is not necessarily related to earnings management.

Which of the Following Best Describes Earnings Management