A WILLINGNESS to manipulate company earnings is key to success in corporate accounting, a study by the American Accounting Association has suggested.
According to the paper, presented at the association’s annual meeting this week, the most successful corporate accountants are those most willing to manage earnings, and are hired and promoted for that reason.
“Executive recruitment professionals indicate that the job candidate whose personality characteristics signal an aversion to earnings management is likely to be screened out before even being considered by prospective employers,” the study said.
When presented a choice between two candidates for a senior corporate accounting position who were similar in background and credentials, 87.5% of accounting and finance executives chose the candidate who was clearly more congenial to earnings management. Seasoned recruiting professionals rated that candidate’s fitness for the job at 81% and the fitness of the more ethically upright rival at only 35%.
“We couldn’t help but be surprised by the overwhelming consensus in favour of a candidate whom study participants considered inferior in just about every aspect of management except the ability to remove roadblocks to reporting a profit,” said Scott Jackson of the University of South Carolina’s Darla Moore School of Business, who conducted the study with colleagues Ling Harris and Joel Owens.