Stories about companies' "earnings management" are well known. But here is a study about using earnings management in a different way -- not to manage the perception of Wall Street but to manage the perception of Washington -- Accounting Information as Political Currency — HBS Working Knowledge:
Such "downward earnings management," as it is known in accounting, seems to have been motivated by the desire of contributing firms to not taint preferred candidates with association to the political red flag of 2004—outsourcing—as well as to ensure future benefits and avoid future costs in regulatory matters.
Is "earnings management" a part of reputation management? And should we classify it as an intangible capability?
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