Quality of reported earnings and its proxies

Abstract

Quality of reported earnings (or earnings quality) is an important and sometimes controversial issue in accounting research. This issue is attracting more and more attention from researchers and policy makers after financial scandals in the 2000s and global financial crisis. At the same time, level of transperancy and quality of accounting information in Vietnam are regarded to be relativelty low in comparision with other Asian countries (Cung (2008), IFC (2013), ADB (2014)). And to integrate deeper into the world economy we have to improve quality of accounting information in general and reported earnings in particular. But what is earning quality and how to measure it? This paper discuss on these issues from perspectives of both accounting standards and positive accounting research.