The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan
Earnings quality of Jordanian public listed firms needs significant improvement due to poor accounting practices and lack of internal governance mechanism, therefore regulators have taken initiative to implement IFRS. This study aims to examine whether earnings quality (value relevance, timely loss...
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2020
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my-uum-etd.93592022-05-17T00:55:34Z The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan 2020 Al-shyoukh, Fayis Mahmoud Rasheed Abdul Manaf, Kamarul Bahrain Tunku Puteri Intan Safinaz School of Accountancy (TISSA) Tunku Puteri Intan Safinaz School of Accountancy (TISSA) HF5001-6182 Business Earnings quality of Jordanian public listed firms needs significant improvement due to poor accounting practices and lack of internal governance mechanism, therefore regulators have taken initiative to implement IFRS. This study aims to examine whether earnings quality (value relevance, timely loss recognition, earnings persistence, earnings management) has improved post-IFRS adoption in Jordan. It also aims to examine whether the effect of IFRS on earnings quality is moderated by family firms to address significant gap in literature. Data covering fifteen years 2001-2003 as pre-IFRS adoption and 2004-2015 as post-IFRS adoption were obtained from the annual reports of Jordanian listed industrial and service sector firms. Findings show that IFRS do not influence value relevance of book value of equity, whereas, the value relevance of earnings is higher after the IFRS adoption under return model only. Timely loss recognition is significantly lower, earnings persistence is significantly higher and earnings management is insignificantly lower after IFRS adoption. The family firms are not a moderator on effect of IFRS on value relevance of book value of equity, whereas, family firms are a moderator on effect of IFRS on value relevance of earnings based on the return model only. Family firms are a moderator on effect of IFRS on timely loss recognition and a moderator on effect of IFRS on earnings persistence. Finally, family firms are not a moderator on the effect of IFRS on earnings management. Overall, there are mixed findings regarding the impact of IFRS adoption and family firms on different measures of earnings quality pre and post-IFRS adoption periods. This study contributes to agency theory by claiming that risk of type 2 agency conflict is somehow lower in family firms after the IFRS adoption that trigger regulators to promote closely held firms to improve IFRS adoption and earnings quality. 2020 Thesis https://etd.uum.edu.my/9359/ https://etd.uum.edu.my/9359/1/depositpermission_s95478.pdf text eng staffonly https://etd.uum.edu.my/9359/2/s95478_01.pdf text eng public https://etd.uum.edu.my/9359/3/s95478_references.docx text eng public other doctoral Universiti Utara Malaysia |
| institution |
Universiti Utara Malaysia |
| collection |
UUM ETD |
| language |
eng eng eng |
| advisor |
Abdul Manaf, Kamarul Bahrain |
| topic |
HF5001-6182 Business |
| spellingShingle |
HF5001-6182 Business Al-shyoukh, Fayis Mahmoud Rasheed The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| description |
Earnings quality of Jordanian public listed firms needs significant improvement due to poor accounting practices and lack of internal governance mechanism, therefore regulators have taken initiative to implement IFRS. This study aims to examine whether earnings quality (value relevance, timely loss recognition, earnings persistence, earnings management) has improved post-IFRS adoption in Jordan. It also aims to examine whether the effect of IFRS on earnings quality is moderated by family firms to address
significant gap in literature. Data covering fifteen years 2001-2003 as pre-IFRS adoption and 2004-2015 as post-IFRS adoption were obtained from the annual reports of Jordanian listed industrial and service sector firms. Findings show that IFRS do not influence value relevance of book value of equity, whereas, the value relevance of earnings is higher after the IFRS adoption under return model only. Timely loss recognition is significantly lower, earnings persistence is significantly higher and earnings management is
insignificantly lower after IFRS adoption. The family firms are not a moderator on effect of IFRS on value relevance of book value of equity, whereas, family firms are a moderator on effect of IFRS on value relevance of earnings based on the return model only. Family firms are a moderator on effect of IFRS on timely loss recognition and a moderator on effect of IFRS on earnings persistence. Finally, family firms are not a moderator on the effect of IFRS on earnings management. Overall, there are mixed findings regarding the impact of IFRS adoption and family firms on different measures of
earnings quality pre and post-IFRS adoption periods. This study contributes to agency theory by claiming that risk of type 2 agency conflict is somehow lower in family firms after the IFRS adoption that trigger regulators to promote closely held firms to improve IFRS adoption and earnings quality. |
| format |
Thesis |
| qualification_name |
other |
| qualification_level |
Doctorate |
| author |
Al-shyoukh, Fayis Mahmoud Rasheed |
| author_facet |
Al-shyoukh, Fayis Mahmoud Rasheed |
| author_sort |
Al-shyoukh, Fayis Mahmoud Rasheed |
| title |
The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| title_short |
The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| title_full |
The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| title_fullStr |
The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| title_full_unstemmed |
The mandatory adoption of IFRS and earnings quality: the moderating effect of family firms in Jordan |
| title_sort |
mandatory adoption of ifrs and earnings quality: the moderating effect of family firms in jordan |
| granting_institution |
Universiti Utara Malaysia |
| granting_department |
Tunku Puteri Intan Safinaz School of Accountancy (TISSA) |
| publishDate |
2020 |
| url |
https://etd.uum.edu.my/9359/1/depositpermission_s95478.pdf https://etd.uum.edu.my/9359/2/s95478_01.pdf https://etd.uum.edu.my/9359/3/s95478_references.docx |
| _version_ |
1747828581195579392 |