We examine asset sales as a method of real earnings management around the benchmarks of loss avoidance and last year's earnings. Evidence is reported of asset sales to boost or reduce earnings near the benchmark of last year's earnings. For the benchmark of zero earnings our results are...

We argue that the effectiveness of corporate governance can best be assessed with reference to its ability to provide a positive outcome with respect to choices made by management or controlling shareholders. We use the curtailment of earnings management as a desirable and measurable outcome of...