scholarly journals The Islamic Capital Market Response to the Real Earnings Management

2017 ◽  
Vol 20 (1) ◽  
pp. 61
Author(s):  
Rita Yuliana ◽  
M Nizarul Alim
Keyword(s):  
Regression Analysis ◽  
Earnings Management ◽  
Prospect Theory ◽  
Capital Market ◽  
Stock Exchange ◽  
Real Earnings Management ◽  
Distribution Analysis ◽  
Earnings Distribution ◽  
Management Actions ◽  
The Status

This study aims to prove the effect of the company's status, i.e membership on the Islamic capital market and the status as suspect firm, as a determinant of real earnings management (REM). REM is conducted by abnormally increasing sales, increasing production and reducing discretionary costs in order to achieve a certain earnings target. This study uses Earnings Distribution Analysis (EDA) technique, which refers to the Prospect Theory (Kahneman & Tversky, 1979) to identify the suspect firms. Suspect firms are companies that have small positive earnings. The samples of this research are companies listed on the Indonesia Stock Exchange in 2011 and 2012. Based on the result of regression analysis, hypothesis testing results show that the suspect firms conduct real earnings management in all three types of activities more aggressively than the non-suspect firms. Furthermore, this study also showed empirical evidence that there are differences in real earnings management actions between companies listed in the Islamic capital market compared to conventional capital markets. Then, this study also showed that the Islamic capital market is more appropriate in response to the REM than the conventional capital market.

scholarly journals The Relationship Between Accrual-Based Earnings Management and Real Earnings Management: Reference to the Polish Capital Market

2020 ◽  
Vol 20 (2) ◽  
pp. 66-81
Author(s):  
Michał Comporek
Keyword(s):  
Earnings Management ◽  
Empirical Research ◽  
Capital Market ◽  
Stock Exchange ◽  
Negative Relationship ◽  
Discretionary Accruals ◽  
Research Area ◽  
Real Earnings Management ◽  
Cross Sectional ◽  
The Relationship

Abstract Research background: The literature on the subject matter emphasizes the lack of empirical research on the relationships between accrual-based earnings management (AEM) and real earnings management (REM), while studies conducted so far are characterized by highly ambiguous results. Purpose: The main aim of the paper is to present the results of empirical research on the relationships between the AEM and REM practices used to create financial results in industrial public companies listed on the WSE. Research methodology: The research sample concerns 72 listed companies whose shares were traded on the Warsaw Stock Exchange (WSE) for a minimum 13 years in the adopted reference period of 2003–2017. The estimation of AEM and REM practices was made by using: the Jones model, the Kang-Sivaramakrishnan model and the Roychowdhury methodology. Results: The empirical results allowed showing the existence of a statistically significant, negative relationship between discretionary accruals and the abnormal level of an operational cash flow indicator, as well as between discretionary accruals and the total REM indicator. An in-depth cross-sectional analysis showed the existence of significantly differentiated relationships between the studied variables in individual branches of industry. Novelty: Research on the relationship between AEM and REM practices in the context of the Polish capital market has not been carried out so far, hence it can be considered a new research area in which there is a justified need to deepen theoretical and empirical research on the EM phenomenon.

scholarly journals The impact of board characteristics on earnings management

2021 ◽  
Vol 10 (3) ◽  
pp. 8-17
Author(s):  
Mahmoud Mohmad Aleqab ◽  
Maha Mohammad Ighnaim
Keyword(s):  
Regression Analysis ◽  
Earnings Management ◽  
Board Of Directors ◽  
Stock Exchange ◽  
The Other ◽  
Real Earnings Management ◽  
Board Members ◽  
Amman Stock Exchange ◽  
The Board Of Directors ◽  
The Impact

This study explores the effect of the board of directors’ characteristics on real earnings management in Jordanian non-financial companies listed on the Amman Stock Exchange. The sample size is 131 companies during the period of 2015–2017. The study uses a board of directors’ size, board members’ independence, board members’ financial experience, number of board meetings, membership in more than one board, and the ownership of board members of company shares to represent the board of directors’ characteristics. Real earnings management is measured using the Roychowdhury model (2006). A multiple regression analysis (panel data) is used to investigate the effect of the board of directors’ characteristics on real earnings management. The study found a negative and statistically significant impact for both: board members’ independence and board members’ financial experience on earnings management through real activities against the previous studies’ findings, this research measured the impact of real activities. On the other hand, the study did not find any statistically significant effect of the additional earnings management variables through actual activities

scholarly journals How does real earnings management affect firms’ future profitability? Evidence from Jordan

2020 ◽  
Vol 18 (1) ◽  
pp. 47-55
Author(s):  
Malek Alsharairi ◽  
Rasha Khamis ◽  
Mahmoud Alkhalaileh
Keyword(s):  
Developing Countries ◽  
Regression Analysis ◽  
Earnings Management ◽  
Stock Exchange ◽  
Real Earnings Management ◽  
Future Research ◽  
Ongoing Debate ◽  
Industrial Companies ◽  
Amman Stock Exchange ◽  
Channel Stuffing

This paper investigates the effects of the lagged real earnings management on the firms’ future profitability using a panel dataset (for the years 2012–2017) from the Jordanian industrial companies listed in the Amman Stock Exchange (ASE). We follow Roychowdhury (2006) to measure real earnings management using two proxies: abnormal sales (REMS) and abnormal production (REMP) in the regression analysis. Our findings reveal that real earnings management through abnormal sales has an insignificant effect on the firms’ future profitability. However, we document evidence that firms’ future profitability is adversely and significantly affected by real earnings management through abnormal production. We contribute to the ongoing debate in the literature of real earnings management and its ramifications on firms’ profitability, specifically in the context of developing countries. This research provides implications for policymakers, investors and managers regarding the potential consequences of channel stuffing practices at the different stages of the supply chain on the firm’s future profitability. Future research is suggested to focus on how real earnings management can possibly disrupt supply chains.

scholarly journals GOOD CORPORATE GOVERNANCE SEBAGAI PEMODERASI: HUBUNGAN ASIMETRI INFORMASI TERHADAP MANAJEMEN LABA PADA PERUSAHAAN LQ 45

2020 ◽  
Vol 7 (1) ◽  
Author(s):  
Jannati Tangngisalu ◽  
Edy Jumady
Keyword(s):  
Corporate Governance ◽  
Regression Analysis ◽  
Earnings Management ◽  
Information Asymmetry ◽  
Stock Exchange ◽  
Secondary Data ◽  
Management Actions ◽  
Negative Results ◽  
Good Corporate Governance ◽  
Regression Techniques

Abstract.  This study aims to determine whether good corporate governance is able to strengthen/weaken the influence of information asymmetry on earnings management. Data collection uses secondary data obtained from financial statements using saturated sampling techniques. The population is all companies listed on the LQ 45 Indonesia Stock Exchange (IDX) of 45 companies, and all companies are used as samples. The results of this study have tested classic assumptions and data analysis methods using multiple linear regression techniques and moderating regression analysis (MRA).The results show that information asymmetry has no significant positive effect on earnings management, which means that earnings management is no longer determined by information asymmetry but is determined by other factors. While the variable of good corporate governance showed significant negative results. This means that good corporate governance can weaken or reduce the effect of information asymmetry on earnings management. So with the decline in information asymmetry in the company, earnings management actions also decline. Abstrak. Penelitian ini bertujuan untuk mengetahui apakah good corporate governance mampu memperkuat / memperlemah pengaruh asimetri informasi terhadap manajemen laba. Pengumpulan data menggunakan data sekunder yang diperoleh dari laporan keuangan dengan menggunakan teknik sampling jenu. Populasinya adalah semua perusahaan yang terdaftar di Bursa Efek LQ 45 Indonesia (IDX) yang berjumlah 45 perusahaan, dan semua perusahaan digunakan sebagai sampel. Hasil penelitian ini telah diuji asumsi klasik dan metode analisis data menggunakan teknik regresi linier berganda dan moderating regression analysis (MRA).Hasil penelitian menunjukkan bahwa asimetri informasi berpengaruh positif tidak signifikan terhadap manajemen laba, yang berarti bahwa manajemen laba tidak lagi ditentukan oleh asimetri  informasi tetapi ditentukan oleh faktor lain. Sedangkan variabel good corporate governance menunjukkan hasil negatif signifikan. Ini berarti bahwa good corporate governance mampu melemahkan atau menurunkan pengaruh asimetri informasi pada manajemen laba. Jadi dengan menurunnya asimetri informasi dalam perusahaan maka tindakan manajemen laba ikut menurun.Keywords: Information Asymmetry, Profit Management, Good Corporate Governance.

scholarly journals PENGARUH REAL EARNING MANAGEMENT TERHADAP ARUS KAS OPERASI PERUSAHAAN DENGAN KUALITAS AUDIT SEBAGAI VARIABEL MODERASI (Studi pada Perusahaan Manufaktur yang Terdaftar di BEI)

MODUS ◽  
2016 ◽  
Vol 27 (1) ◽  
pp. 65 ◽  
Author(s):  
Felicianus Adi Nugroho ◽  
Dewi Ratnaningsih
Keyword(s):  
Earnings Management ◽  
Audit Quality ◽  
Stock Exchange ◽  
Predictive Ability ◽  
Real Earnings Management ◽  
Earning Management ◽  
Manufacturing Companies ◽  
Management Actions ◽  
The Relationship

This study aims to determine the efect of real earnings management which is a proxy of earnings management to the predictive ability of fnancial reports through the company’s operating cash fow. Researchers also consider the infuence exerted by the quality of audits of the relationship between real earnings management with the company’s operating cash fow. Samples are manufacturing companies listed in Indonesia Stock Exchange during the period of observation 2010-2012.Berdasarkan criteria previously set contained 249 corporate data used in this study. The results of this study revealed that real earnings management has an infuence on the predictive ability of fnancial statements through operating cash fow. Quality audits can also afect earnings management actions undertaken by the company and consequently also of the operating cash fow of the company. Overall audit quality may afect the actions of earnings management and certainly also the predictive ability of corporate fnancial statements.Keywords: real earnings management, operating cash fow, and audit quality.

scholarly journals The Effects of Tax Avoidance, Accrual Earnings Management, Real Earnings Management, and Capital Intensity on the Cost of Equity

2018 ◽  
Vol 10 (1) ◽  
pp. 40-50
Author(s):  
Amrie Firmansyah ◽  
Ahmad Sigid Febriyanto
Keyword(s):  
Earnings Management ◽  
Stock Exchange ◽  
Tax Avoidance ◽  
Multiple Linear Regression Model ◽  
Sampling Technique ◽  
Capital Intensity ◽  
Real Earnings Management ◽  
Cost Of Equity ◽  
Management Actions ◽  
The Cost

This study aims to examine the effects of tax avoidance, accrual profit management, real profit management, and capital intensity on equity costs. The population of this study is a manufacturing company listed on the Indonesia Stock Exchange which amounted to 146 companies. The sampling technique used was purposive sampling and resulted in 420 units of analysis. This type of research is quantitative causality by performing hypothesis testing analysis is done by using multiple linear regression model. The findings of this research are tax avoidance will add to the risks that must be borne by investors thus increasing uncertainty over their investment. Investors consider that accrual profit management actions are opportunistic as risk-taking actions as well as real profit management actions. While on Capital Intensity, investors assume the information on the company’s fixed assets is not useful in making investment decisions. The conclusions that can be taken are tax avoidance, accrual profit management, and earnings management real positive to the cost of equity. However, capital intensity has a negative effect.

scholarly journals Bagaimana Peran Tata Kelola Perusahaan Dalam Hubungan Antara Manajemen Laba Dan Risiko Idiosinkratik di Indonesia?

2021 ◽  
Vol 26 (2) ◽  
pp. 229
Author(s):  
Amrie Firmansyah, Nopriyanto Hady Suhanda
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Stock Prices ◽  
Financial Services ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Idiosyncratic Risk ◽  
Real Earnings Management ◽  
Management Actions ◽  
The Relationship

This study aims to investigate the effect of accrual earnings management and real earnings management on idiosyncratic risk. In addition, this study also examines the role of corporate governance in the relationship between the two. This study uses a quantitative approach. Research data obtained from www.idx.co.id and www.finance.yahoo.com in financial report data and company stock prices from 2012 to 2017 are listed on the Indonesia Stock Exchange. Based on purposive sampling, the total sample of this study amounted to 244 observations. Hypothesis testing is conducting by employing multiple linear regression analysis for panel data. This study suggests that real earnings management and accrual earnings management have a positive effect on idiosyncratic risk. This study also finds that corporate governance fails to weaken the relationship between earnings management and idiosyncratic risk. This study indicates that the Indonesia Financial Services Authority needs to coordinate with the Indonesian Institute of Accountants to reduce earnings management actions by companies listed on the Indonesia Stock Exchange.

scholarly journals The effect of financial distress and earnings management on tax aggressiveness with corporate governance as the moderating variable

2020 ◽  
Vol 9 (7) ◽  
pp. 167-176
Author(s):  
Ratih Pujirahayu Nugroho ◽  
Sutrisno T Sutrisno ◽  
Endang Mardiati
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Financial Distress ◽  
Stock Exchange ◽  
Real Earnings Management ◽  
Audit Committees ◽  
Manufacturing Companies ◽  
Sample Collection ◽  
Financial Reports ◽  
Tax Aggressiveness

This study aims to verify the correlation between financial distress and earnings management of tax aggressiveness moderated by corporate governance. This study uses a population of manufacturing companies that publish their financial statement on the Indonesia Stock Exchange from 2017 until 2018. Sample collection was performed using a purposive sampling method, resulting in a total of 212 populations that published complete financial reports. This study was tested by using the Multiple Regression Analysis test. This research gave empirical proofs that financial distress and real earnings management positively influenced the tax aggressiveness was supported, the proportion of independent commissioners weakened the financial distress and negatively impacted the tax aggressiveness was supported, the total audit committees weakened the financial distress and negatively influenced the tax aggressiveness was not supported, the proportion of independent commissioners and total audit committees weakened the real earnings management and negatively affected the tax aggressiveness was not supported

scholarly journals IFRS ADOPTION AND EARNINGS MANAGEMENT PRACTICE: EVIDENCE FROM INDONESIA COMPANIES

2019 ◽  
Vol 7 (2) ◽  
pp. 229-239
Author(s):  
Vina Kholisa Dinuka
Keyword(s):  
Earnings Management ◽  
Management Practices ◽  
Stock Exchange ◽  
Management Practice ◽  
Real Earnings Management ◽  
Manufacturing Companies ◽  
Discretionary Accrual ◽  
Ifrs Adoption ◽  
Negative Effect ◽  
Ifrs Implementation

The purpose of this study is to verify IFRS contribution by examining the presence of Accrual Earnings Management (AEM) and Real Earnings Management (REM) in the period pre- and post- IFRS implementation in manufacturing companies in Indonesia. AEM is measured by absolute value of discretionary accrual, while REM is proxied by three measurements of REM, they are abnormal cash flow operation, abnormal production and abnormal discretionary expenses. The sample is taken from Indonesia stock exchange in 2009-2011 and 2013-2015. 2012 is Indonesia adoption period and it is excluded from the sample, because it is considerated as transitory year. This study uses regression analysis and Paired t-test to compare the presence of AEM and REM preceding and following IFRS implementation. The findings reveal that IFRS adoption has significantly negative effect towards AEM and REM. It indicates that the following IFRS implementation, AEM and REM are decrease. Therefore, IFRS is able to reduce earnings management practices in manufacturing companies in Indonesia both for AEM and REM.

scholarly journals PENGARUH INFORMASI LABA TERHADAP REAKSI PASAR DENGAN MANAJEMEN LABA RIIL DAN MANAJEMEN LABA AKRUAL SEBAGAI VARIABEL MODERASI

2019 ◽  
Vol 13 (1) ◽  
pp. 1-23
Author(s):  
Santi Santi ◽  
Kurniawati Kurniawati
Keyword(s):  
Earnings Management ◽  
Market Reaction ◽  
Stock Exchange ◽  
Real Earnings Management ◽  
Manufacturing Companies ◽  
Statistical Tool ◽  
Significance Level ◽  
Moderating Variables ◽  
Earnings Information ◽  
Final Sample

This study aims to investigate the effect of earnings information on market reaction with accrual and real earnings management as the moderating variables. The sample of this study is manufacturing companies listed in the Indonesia Stock Exchange in 2012-2015. Samples are collected by purposive sampling and resulted in 58 companies as the final sample. Data were analyzed using Moderated Regression Analysis (MRA) for testing hypothesis with significance level 5%. The statistical tool used is SPSS 22. The results of this study shown that market reacts positively significant toward earnings management and real earnings management in aggregate weaken the effect of earnings information toward market reaction. Real earnings management through discretionary expenses strengthen the effect of earnings information toward market reaction. Meanwhile, real earnings management through sales manipulation and overproduction, and accrual earnings management do not moderate the effect of earnings information toward market reaction.

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