Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence

An alarming rate of real earnings management (REM) in the Jordanian firms calls for concern, given the adverse effects of the practice in the long run. The weak state of corporate governance (CG) in Jordan is also considered as a critical issue, demanding for reforms of CG practices that can diminis...

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Main Author:	Oqlah Alkharashgah, Khaled Ahmad
Format:	Thesis
Language:	eng eng eng eng
Published:	2021
Subjects:	HD28-70 Management Industrial Management HF5601-5689 Accounting
Online Access:	https://etd.uum.edu.my/9476/1/s901660_01.pdf https://etd.uum.edu.my/9476/2/s901660_02.pdf https://etd.uum.edu.my/9476/3/s901660_references.docx https://etd.uum.edu.my/9476/4/permission%20to%20deposit-901660.pdf
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id	my-uum-etd.9476
record_format	uketd_dc
spelling	my-uum-etd.94762022-08-08T01:32:19Z Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence 2021 Oqlah Alkharashgah, Khaled Ahmad Amran, Noor Afza Ishak, Rokiah Tunku Puteri Intan Safinaz School of Accountancy (TISSA) Tunku Puteri Intan Safinaz School of Accountancy HD28-70 Management. Industrial Management HF5601-5689 Accounting HF5667 Professional Ethics. Auditors. An alarming rate of real earnings management (REM) in the Jordanian firms calls for concern, given the adverse effects of the practice in the long run. The weak state of corporate governance (CG) in Jordan is also considered as a critical issue, demanding for reforms of CG practices that can diminish REM. Thus, this study investigated the relationship between CG mechanisms and REM practices of non-financial firms listed on the Amman Stock Exchange (ASE). The study also tested the moderating effect of managerial ownership (MOWN) on the relationship between board of directors’ characteristics, audit committee characteristics and REM practices. The data, which covered 721 firm-year observations for the period of 7 years (2011-2017), was sourced from the annual reports of the listed non-financial companies on ASE. The results show that board characteristics (CEO duality and frequency of meeting) and audit committee characteristics (independence, expertise and frequency of meeting) are significant predictors which can mitigate REM practices in the Jordanian firms. Family ownership is also a significant determinant that mitigates REM practices, but MOWN is a weak moderating factor in the relationship between CG mechanisms and REM. The current study may help regulatory bodies and policy-makers in instituting policies and strategies with regards to the credibility of financial reports in Jordan. The study also benefits firms in formulating the best corporate strategies and improving their system controls, and the users of the financial information, especially the investors in making their financial decisions. Future studies may investigate the role that can be played by external CG mechanisms (e.g. company valuations, managerial labor market, legal implications and others) in mitigating REM activities in the companies. Also, future research can examine some external factors that may have indirect effects on the CG’s relationship with REM, as it will enrich the existing literature. 2021 Thesis https://etd.uum.edu.my/9476/ https://etd.uum.edu.my/9476/1/s901660_01.pdf text eng public https://etd.uum.edu.my/9476/2/s901660_02.pdf text eng public https://etd.uum.edu.my/9476/3/s901660_references.docx text eng public https://etd.uum.edu.my/9476/4/permission%20to%20deposit-901660.pdf text eng staffonly other doctoral Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng eng eng
advisor	Amran, Noor Afza Ishak, Rokiah
topic	HD28-70 Management Industrial Management HF5601-5689 Accounting HD28-70 Management Industrial Management
spellingShingle	HD28-70 Management Industrial Management HF5601-5689 Accounting HD28-70 Management Industrial Management Oqlah Alkharashgah, Khaled Ahmad Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
description	An alarming rate of real earnings management (REM) in the Jordanian firms calls for concern, given the adverse effects of the practice in the long run. The weak state of corporate governance (CG) in Jordan is also considered as a critical issue, demanding for reforms of CG practices that can diminish REM. Thus, this study investigated the relationship between CG mechanisms and REM practices of non-financial firms listed on the Amman Stock Exchange (ASE). The study also tested the moderating effect of managerial ownership (MOWN) on the relationship between board of directors’ characteristics, audit committee characteristics and REM practices. The data, which covered 721 firm-year observations for the period of 7 years (2011-2017), was sourced from the annual reports of the listed non-financial companies on ASE. The results show that board characteristics (CEO duality and frequency of meeting) and audit committee characteristics (independence, expertise and frequency of meeting) are significant predictors which can mitigate REM practices in the Jordanian firms. Family ownership is also a significant determinant that mitigates REM practices, but MOWN is a weak moderating factor in the relationship between CG mechanisms and REM. The current study may help regulatory bodies and policy-makers in instituting policies and strategies with regards to the credibility of financial reports in Jordan. The study also benefits firms in formulating the best corporate strategies and improving their system controls, and the users of the financial information, especially the investors in making their financial decisions. Future studies may investigate the role that can be played by external CG mechanisms (e.g. company valuations, managerial labor market, legal implications and others) in mitigating REM activities in the companies. Also, future research can examine some external factors that may have indirect effects on the CG’s relationship with REM, as it will enrich the existing literature.
format	Thesis
qualification_name	other
qualification_level	Doctorate
author	Oqlah Alkharashgah, Khaled Ahmad
author_facet	Oqlah Alkharashgah, Khaled Ahmad
author_sort	Oqlah Alkharashgah, Khaled Ahmad
title	Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
title_short	Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
title_full	Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
title_fullStr	Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
title_full_unstemmed	Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence
title_sort	corporate governance mechanisms, managerial ownership and real earnings management: jordanian evidence
granting_institution	Universiti Utara Malaysia
granting_department	Tunku Puteri Intan Safinaz School of Accountancy (TISSA)
publishDate	2021
url	https://etd.uum.edu.my/9476/1/s901660_01.pdf https://etd.uum.edu.my/9476/2/s901660_02.pdf https://etd.uum.edu.my/9476/3/s901660_references.docx https://etd.uum.edu.my/9476/4/permission%20to%20deposit-901660.pdf
_version_	1747828603725283328

Corporate governance mechanisms, managerial ownership and real earnings management: Jordanian evidence

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