Corporate governance, results management and external audit.

Purpose: As earnings manipulation and external auditing are a relevant and current topic, given the recent worldwide financial scandals and their inferences in the disclosed results of companies and in the quality of their financial reports, the objective of this study is to understand how and why multinationals can exert influence in the manipulation of results of their subsidiaries based in host countries with an organizational culture different from that of the home country. Methodology: In order to respond to this objective, a qualitative methodology was adopted, specifically the case study, which provides greater involvement of researchers in action research. Empirical evidence was obtained from a subsidiary besieged in Portugal and owned by an Asian multinational. Additionally, the subsidiary studied produces a strategic product for Asia, among other countries, so its acquisition by a foreign group was essential to face its shortage in the shareholder's country of origin. Results: The results obtained and discussed in the light of the literature show that the results presented by the subsidiary were manipulated between 2008 and 2016 by exponential pressure from shareholders, in which the external audit and corporate governance did not work as a reducing factor of this manipulation, which is a practice common in this multinational, whose financial reporting may contain material errors. Finally, the conclusions, limitations and future research agenda are drawn up [ABSTRACT FROM AUTHOR]