The Impact of the Practice of Earnings Management on Financiers’ Decisions and the Role of Audit Quality as a Moderator Variable: Evidence from Manufacturing Companies Listed on Amman Stock Exchange

Mohammad Nassar, Lina Hani Warrad and Mahmoud Nassar

International Journal of Academic Research in Business and Social Sciences, 2017, vol. 7, issue 11, 580-589

Abstract: The current study aimed to identify the impact of Earnings Management on Financiers’ decisions, either those financiers are creditors or investors, and the role of the mediator variable, the Audit Quality, on the relationship between the independent and dependent variables. The study population consisted from manufacturing companies in Amman Stock Exchange for the period 2005-2009. In order to address the study aims, the researcher used descriptive statistical methods for all variables of the study and tested the hypotheses of the study using the multiple regression models. The study results revealed that there is no impact of earning management on financier decisions and there no impact for the mediator variable on the relationship between the independent and dependent variables. In regards to the control variables, we found that there is an impact of earning per share percentage on investor decision; in contrast there is no impact of growth and the firm size. In addition, there is an impact of growth percentage in creditor’s decision, while there is no impact on firm size or growth percentage.

Keywords: Earning management; financers’ decisions; Audit Quality; Firm size; Earning per share percentage; growth percentage (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:hur:ijarbs:v:7:y:2017:i:11:p:580-589

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