Considering the voluminous published research confirming and extending the original findings of Cohen, Dey, and Lys (2008), we conclude that Pincus, Wu, and Hwang (2022) make a modest contribution to the earnings management literature. Specifically, their analysis does not incorporate recent advances in the earnings management literature, especially the measurement and estimation of real earnings management activities and the incorporation of the changing information environment. As a result, we conclude that the Pincus et al. (2022) results and conclusions with regards to the substitution between accrual-based and real earnings management activities should be interpreted with caution.

JEL Classifications: G10; M4.

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