بررسی رابطه بین مدیریت سود و نقدینگی بازار Examining the relationship between earning management and market liquidity

1. Introduction Healy & Palepu (2001) suggest that the cascade of financier and accountant scandals that marked the beginning of this decade has shed light on the role of transparent and clear information in maintaining a well operate financial market. The concept of Market liquidity is highly dependent on informational transparency. High liquidity allows companies to raise additional funds on favourable terms through low transaction costs and no time lag between economic agents (Stoll, 1978; Glosten & Milgrom, 1985). The presence of information asymmetry in the market may reduce liquidity (Jacoby et al. 2000). Therefore, liquidity forms a very timely issue that is gaining a growing interest. This issue is correlated with an increased focus on the issue of quality of information. This focus presently dates back a number of years, but in recent years, and following multiple scandals (WorldCom , Enron , Vivendi, Parmalat … ) the subject has become topical again. Since the resurgence of interest, several reform initiatives have been made (Sarbanes -Oxley in the United States, financial security law in France) and the adoption of IFRS which has been adjusted from 2005 accounting standards. These initiatives are part of the process of harmonizing financial reporting at the European level and choosing accounting convergence. The objective is to reduce accounting manipulations and earning management in favour of better financial transparency, which appears as a necessary objective to increase security for investors. The present work falls within this context. Indeed, we try in this research to study the relationship between the quality of the information disclosed, and particularly the level of earnings management, and the liquidity of companies. The study of this relationship is of considerable interest because of its important implications for both companies and investors.