| Summary: | 碩士 === 朝陽科技大學 === 會計系 === 103 === Prior studies suggested that weaker corporate governance mechanisms are positive associated with amounts of related party transactions. Another studies reported that CFOs preferred stable company values to earnings. The purpose of this study is to examine the relationship between income smoothing and related party transactions. Furthermore, this study explores association between related party transactions and income smoothing in the perspective of corporate governance.
The empirical results show that corporate governance can reduce the effect of related party transactions on income smoothing but not significant. Related party transactions in sales ratio has positive effects on income smoothing significantly. Related party transactions in purchases ratio have negative effect on income smoothing significantly. Compared with groups by industry, the electronics industry appears to have higher smoothing earnings than other industries. Finally, considered with corporate governance, the size of board and the pledging ratio of shareholdings of directors and supervisors have positive effect on income smoothing significantly.
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