Abstract
This study examines the linear relationship between corporate attributes and corporate accruals (discretionary accruals) in Bangladesh. The behaviour of corporate accruals is explained by corporate attributes such as asset size, turnover, earnings per share, number of shareholders, year of listing, international link of audit firm, ownership structure, internationality, market category, and leverage. A statistically significant relationship is observed between corporate accruals and asset size. We also observed inconsistent growth of inventory, faster growth of accounts receivable with an overvaluation of fixed assets reported by probe committee. Indeed, corporate accruals are not dependent on corporate attributes but rather on the mindset of the corporate manager. Management is in a unique position to produce fraudulent financial statements. The study suggests a number of measures including the establishment of an Institute of Chartered Surveyor of Bangladesh (ICSB), the introduction of audit reviews, the updating of corporate governance guidelines, increasing the effectiveness of board independence, and the strengthening institutional setting, in order to protect the rights of stakeholders, especially marginal shareholders.