The main objective of this thesis is to investigate the relationship between financial performances and accounting accruals. Financial performance consists of net income, correlations between firm earnings and industry earnings and cashflow from operations. The data set include Thai listed companies in 2004. Both descriptive statistics (frequency, percentage, minimum, maximum, mean and standard deviations) and inferential statistics, multiple regression analysis are employed to analyze the data. It is found that, as expected, at 95% confidence interval, net income and correlations between firm earnings and industry earnings significantly relate to accounting accruals in positive manners. On the other hand, cashflow form operations significantly relates to accounting accruals in negative manners. In addition, the control variables also significantly related to accounting accruals. They include industry type, firm size and lagged accounting accruals. The results agree with previous study (i.e. Heidi et., al., 2003 and Myung and Byung, 2004). The contribution of this study shows that investors and financial statement users are convinced to pay attention to earnings management of companies.