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Question 5 Earnings Management & Disclosures (20 marks) Josh Goodwin is the Chief Executive Officer of HonestBird, a local startup providing delivery and concierge services

Question 5 Earnings Management & Disclosures (20 marks)

Josh Goodwin is the Chief Executive Officer of HonestBird, a local startup providing delivery and concierge services in Melbourne. Given the challenges of being a startup, it is also working towards raising funds from prospective investors.

a) Define 'earnings management'. Do you consider it to be good or bad? Why? (8 marks)

b) Discuss three earnings management techniques with respective examples that HonestBird could apply to make itself more attractive to the prospective investors. (12 marks)

Total 20 marks

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