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The accounting scandals at companies such as Enron, World Com and Tyco involved the use of inside information by top management to sell shares

 

The accounting scandals at companies such as Enron, World Com and Tyco involved the use of inside information by top management to sell shares owned at a relatively favourable price compared to the future price. Many corporate managers, auditors and analysts are participants in the earnings management. Describe any two motivation for earnings management and advice whether it is ethical for companies to involve in earnings management.

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