Management discretion, earnings management, and earnings manipulation: Are these ethical? Legal? DISCUSS how a decision can be considered a legitimate choice and how it can also be considered improper. For example, I can select a depreciation method that fairly represents the way the asset?s usefulness is used or I could select a method just to inflate expenses. Is that illegal? Unethical? Or both? Is it discretion, management, or manipulation?
Your posting should demonstrate that you understand the differences among discretion, management and manipulation.
Support your answer using a minimum of two professional or academic sources
Management discretion, earnings management, and earnings manipulation 3 4
References Journal of Accounting and Economics
Accounting Review 91
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