Executive Takeaways
■ REM involves altering transactions, such as cutting expenses, to meet financial targets. ■ REM has become much more prevalent as auditors focus on accounting estimates. ■ We find that auditors view management negatively when there is REM. ■ A key indicator of REM is that the company exceeded its profit target.
Dana R. Hermanson, Professor, Dinos Eminent Scholar Chair of Private Enterprise
Made with FlippingBook - Online catalogs