Abstract: This paper investigates both the accrual and real-based earning management activities around seasoned equity offerings(SEOs),and their effects on firm performance in China.The results show that both accrual and real manipulations are used around SEOs,but their effects are different.In specifically,the accruals manipulation leads to performance decline in short run,while the real activities manipulation may hurt long-run performance.In comparison,the company's poor performance post SEO is more attributable to real earnings management.Our findings contribute to the literature by showing that the post-SEO performance decline due to the real activities management is more severe than that due to accrual management.

Key words: equity refinancing, earnings management, accruals manipulation, real activities manipulation