Big Bath Accounting e turnover de executivos em empresas listadas na B3

Viviane Theiss; Henrique Portulhak; Marcos Roberto Kuhl; Romualdo Douglas Colauto

doi:10.18593/race.18855

Authors

Viviane Theiss Universidade Federal de Santa Catarina (UFSC) https://orcid.org/0000-0002-2450-9704
Henrique Portulhak Universidade Federal do Paraná https://orcid.org/0000-0002-9097-2481
Marcos Roberto Kuhl Universidade Federal do Paraná https://orcid.org/0000-0001-6578-5804
Romualdo Douglas Colauto Universidade Federal do Paraná https://orcid.org/0000-0003-3589-9389

DOI:

https://doi.org/10.18593/race.18855

Keywords:

Income management, Big Bath Accounting, Executives turnover

Abstract

An executive's turnover can become a plausible justification for a greater use of discretionary accumulations in a given period, with consequent evidence of a supposed greater loss to the company, with the intention to informing the market, in later periods, of apparent improvements in the results of the organization, which configures the use of discretionary accumulations through the mode of income management called Big Bath Accounting (BBA). In this context, the objective of the study was to identify the extent to which the change of executives in companies listed on B3 is associated with income management. A total of 1,407 observations were made from 254 companies from 2009 to 2014, using Dechow, Hutton, Kim, and Sloan (2012) model for detection income management, information available by the Bloomberg® database to identify the turnover events, using the size (natural logarithm of the Asset) as control variable. The sample has a concentration of executives over 50 years of age, with a high turnover in this position, with preference for the appointment of internal persons to the role of CEO and greater representation of turnover in the year 2013.The tests carried out didn’t find any evidence that BBA changes due to the variation of discretionary accruals in the period. Likewise, there was an unconfirmed existence of differences between the hiring of insiders and outsiders executives for the use of more discretionary spending. Despite the lack of statistical evidence, the study helps to understand the BBA concepts and encourages the breaking of paradigms, through empirical evidence of executive turnover, regarding this mode of results management.

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