Game Analysis on the Shareholders, the Manager and the Auditor in Equity Incentive Process

Fu Bi Luo

doi:10.4028/www.scientific.net/AMR.787.997

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HomeAdvanced Materials ResearchAdvanced Materials Research Vol. 787Game Analysis on the Shareholders, the Manager and...

Game Analysis on the Shareholders, the Manager and the Auditor in Equity Incentive Process

Abstract:

Equity incentive is a two-edged sword. In this paper, a three party game model among shareholders, the manager and auditor is built to study the equity incentives negative effects. The results are: the probability of the manager and the auditors collusion to manipulate accounting information is negative connected with the shareholders punishment, and is positive connected with the monitoring cost. Shareholders should improve the technical ability and measures to punish the manager and auditor heavily when they collude to manipulate financial information; Shareholders and the regulatory agencies should give no chance to the manager and the auditor to obtain extra income from accounting information manipulation as much as possible.

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Periodical:

Advanced Materials Research (Volume 787)

Pages:

997-1001

DOI:

https://doi.org/10.4028/www.scientific.net/AMR.787.997

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Online since:

September 2013

Authors:

Fu Bi Luo

Keywords:

Equity Incentive, Financial Information Manipulation, Game Analysis

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