scholarly journals Rzeczowe zarządzanie zyskiem jako instrument kształtowania dużych strat w przedsiębiorstwach przemysłowych

2021 ◽  
Vol 3 (31) ◽  
pp. 25-39
Author(s):  
Michał Comporek
Keyword(s):  
Stock Exchange ◽  
Cash Flows ◽  
Production Costs ◽  
Real Earnings Management ◽  
Industrial Enterprises ◽  
Industrial Companies ◽  
Warsaw Stock Exchange ◽  
Trade Credits ◽  
Liberal Approach ◽  
The Impact

The purpose of the article/hypothesis: The aim of the paper is to show the importance of the implemented real earnings management (REM) in the intentional shaping of large losses in public industrial enterprises listed on the Warsaw Stock Exchange. Methodology: The basic method of assessing the REM activities was compliant with the Roychowdhury methodology, enabling the estimation of the abnormal levels of: operational cash flows, production costs and discretionary expenses. In turn, the modified verision of iosik model was used to assess the impact of REM practices on the frequency of large losses in tested sample. Results of the research: The obtained results show that the REM implemented by means of overproduction, granting above-average rebates and a liberal approach in the field of trade credits may be considered an important path of intentional deepening of the net loss in public industrial companies.

scholarly journals The Impact of Managerial Ability on the Relation between Real Earnings Management and Future Firm’s Performance: Applied Study

2019 ◽  
pp. 59-96
Author(s):  
Mohamed Hessian
Keyword(s):  
Earnings Management ◽  
Negative Impact ◽  
Cash Flows ◽  
Production Costs ◽  
Real Earnings Management ◽  
Managerial Ability ◽  
Firm Resources ◽  
Sales Revenue ◽  
Operational Activities ◽  
The Impact

This study aims to investigate the managerial ability of executives’ managers’ role on mitigating the negative impact of real earnings management on future firm’s performance. The researcher operationalizes managerial ability by using a measure developed by Demerjian, Lev, and McVay (2012). This measure captures managers’ ability to efficiently convert firm resources into sales revenue relative to their industry peers. In other words, higher-ability managers are more likely to generate more sales revenue for a given set of resources compared to lower-ability managers. The researcher follows Roychowdhury (2006) and Kothari et al. (2016) to calculate abnormal sales, abnormal production costs, and abnormal discretionary expenses. To capture the total effects of three REM methods an aggregate REM that is a proxy for real earnings activities was used. Following Gunny (2010) and Huang & Sun (2017) future performance proxies are ROA and operating cash flows to total assets (CFO) for the next three years each year. Using a panel sample of 605 firm-year observations from 2005 to 2015. The study concluded that there is a positive significant relationship between the managerial ability of managers and earnings management through manipulating of real operational activities.

scholarly journals The credibility of earnings announced by new stock companies: accrual and real earnings management

Equilibrium ◽  
2021 ◽  
Vol 16 (3) ◽  
pp. 661-677
Author(s):  
Tomasz Sosnowski
Keyword(s):  
Earnings Management ◽  
Initial Public Offering ◽  
Financial Reporting ◽  
Value Added ◽  
Financial Statements ◽  
Discretionary Accruals ◽  
Cash Flows ◽  
Production Costs ◽  
Real Earnings Management ◽  
The Impact

Research background: An initial public offering (IPO) creates an excellent opportunity to research the impact of changes in the institutional environment of companies on the trustworthiness of the information disclosed in financial statements. Purpose of the article: The main aim of the study is to analyze the use of accrual and real earnings management to inflate earnings, revenue, or total assets around the going public event. Therefore, this paper contributes to the stream of study on the quality of financial reporting of new stock companies. Methods: Two main approaches reflect the use of various types of earnings management activities, i.e., discretionary accruals and real earnings management. In both cases, it was necessary to use proper OLS method estimated models to identify the normal level of categories that affect the results reported in financial statements. Findings & value added: Based on a sample of 183 IPOs from the Warsaw Stock Exchange between 2005 and 2015, generally, managers of newly-listed companies actively use discretionary accruals, reduce production costs and certain discretionary expenses, and abnormal cash flows from operations ? i.e., all proxies of earnings management used in the paper ? in the periods around the IPO. In the period prior to the IPO, managers more often introduce techniques typical of the real sphere of the company's operations, in particular, the deliberate modeling of certain discretionary costs. In turn, the use of discretionary accruals dominates in the year after the IPO.

scholarly journals Study on Companies from the Energy Sector from the Perspective of Performance through the Operating Cash Flow

Energies ◽  
2021 ◽  
Vol 14 (12) ◽  
pp. 3667
Author(s):  
Claudia Diana Sabău-Popa ◽  
Luminița Rus ◽  
Dana Simona Gherai ◽  
Codruța Mare ◽  
Ioan Gheorghe Țara
Keyword(s):  
Labor Productivity ◽  
Cash Flow ◽  
Stock Exchange ◽  
Average Duration ◽  
Significant Negative Correlation ◽  
Cash Flows ◽  
Energy Sector ◽  
Or Management ◽  
Operating Cash Flow ◽  
The Impact

In this paper we analyzed the link between companies’ performance, in terms of cash and income, and the labor productivity or management rates, in case of the companies from the energy sector listed on the Bucharest Stock Exchange. We focused on the energy sector because of the impact that its expansion has on the evolution of economies around the world and because of its dynamics in the sense of gradually shifting to the use of energy from renewable sources. We have used panel regression models to analyze the operating cash flow and the profitability rates and the determination of a causal or dependency relationship with labor productivity or management rates. The results of this study show a significant negative correlation between operating cash flows and the average duration of stock rotation, and no correlation between productivity and the operating cash flow. Instead, the average duration of stock turnover does not at all influence the profitability rates, and productivity is always significant for the return on assets, ie forthe return on equitywith a positive coefficient, as expected. The gap between the average duration of payment of suppliers and the average duration of receivables does not significantly influence neither the cash flow nor the rates of return.

scholarly journals The Impact of Cognitive Integration between the Traditional Balanced Scorecard and the Information Technology Balanced Scorecard on the Entrepreneurship Value of the Jordanian Public Shareholding Industrial Companies

2017 ◽  
Vol 13 (1) ◽  
pp. 153
Author(s):  
Usama Abdul Moneim ◽  
Ala Jaber Matarneh ◽  
Samer Akour
Keyword(s):  
Balanced Scorecard ◽  
Stock Exchange ◽  
Integrated System ◽  
Cognitive Integration ◽  
The Balanced Scorecard ◽  
Institutional Leadership ◽  
Industrial Companies ◽  
Amman Stock Exchange ◽  
The Impact

Due to the increased competition between the various industrial companies at the local and international levels, there became a need to adopt modern and effective methods and tools that enable such companies to acquire and maintain competitive advantages that help them choose, apply and assess the strategies adopted. One of the most important tools is the Balanced scorecard according to the leadership concept and the decisions of the COBIT committee; this tool had a great concern and attention by researchers or businessmen; applying it led to a remarkable success in some companies, which made it move from a mere tool of management to an integrated system of strategic management. The method of measuring the balanced scorecard according to the COBIT committee helps the industrial companies’ measure their strategic performance wisely and even goes further in helping formulate the companies' industrial strategies in a pioneer method, translate them into strategic goals, translate these objectives into strategic measurements achieving a follow-up and finally assess the industrial strategy locally and globally. Accordingly, the study aimed at shedding light on the impact of the cognitive integration among the dimensions of the traditional balanced scorecard and the IT balanced scorecard on the Entrepreneurship value in the industrial companies. The study community consisted of all the public shareholding industrial companies listed on Amman Stock Exchange by the end of (2015) amounting to (63) (Annual Report of Amman Stock Exchange, 2016). (56) Companies were randomly selected to form the study sample. One of the most important results of the study is that the effectiveness of measuring the quality of applying the traditional Balanced Scorecard and the IT Balanced Scorecard will create the Entrepreneurship value of the industrial companies, thus contributing to achieving the company's strategic objectives. The study recommended the need that the industrial companies follow up the local and international issues linked with the IT related to applying the balanced scorecard to reach for the institutional leadership with the need that such companies encourage innovation processes, accepting new ideas and motivating employees to provide innovative ideas.

scholarly journals The Impact of CEOs' Compensations on Cost Stickiness in Industrial Companies Listed on the Amman Stock Exchange

2021 ◽  
Vol 15 (1) ◽  
pp. 152
Author(s):  
Lina Fuad Hussien
Keyword(s):  
Stock Exchange ◽  
Industrial Companies ◽  
Level Of Activity ◽  
Cost Behavior ◽  
Study Population ◽  
The Difference ◽  
High Level ◽  
The Cost ◽  
The Impact ◽  
Cost Stickiness

The purpose of this study is to analyze the asymmetry in cost behavior (cost stickiness) and to identify the impact of CEOs' compensation on the degree of cost stickiness behavior. The study population consists of the public shareholding companies listed on the ASE, which number (56) industrial company. Data were collected from (35) industrial companies for the period (2009 - 2019). To measure the degree of costs stickiness, The Model of Weiss (2010) was used. The Model of Weiss (2010) takes into account the costs and changes in the level of activity (sales) for the last four quarters of the company, Weiss (2010) model constructs the difference in logarithmic ratios of changes in cost. The study found that the CEO's compensation in Jordanian industrial companies consists of two forms. The companies pay fixed salaries or performance-related bonuses. The study found that the form of compensation that is paid to the CEO affects the behavior of managers. The results indicated that the performance-related rewards are accompanied by a decrease in the level of cost stickiness, and the compensation paid in the form of fixed salaries are accompanied by a high level of cost stickiness. The study recommends that companies should understand the role of the compensation form in administrative decisions, especially with regard to resource modifications, as management motives in relation to resource modifications must be taken into account because of their clear and direct impact on the cost structure of companies.

scholarly journals The Impact of Acquisition on Stock Value in Case of Warsaw Stock Exchange

2019 ◽  
Vol 16 (1) ◽  
pp. 70-79
Author(s):  
Wojciech Kaczmarczyk
Keyword(s):  
Stock Prices ◽  
Information Transfer ◽  
Banking Sector ◽  
Stock Exchange ◽  
Public Information ◽  
Electronic System ◽  
Market Reactions ◽  
Warsaw Stock Exchange ◽  
Market Indexes ◽  
The Impact

Abstract Research purpose: Seven of 10 companies that have won the Polish Forbes edition Merge & Acquisition 2018 Ranking are listed on Warsaw Stock Exchange. The aim of the conducted research was to test if the biggest acquisitions have an impact on stocks value and is it possible for typical investor to create extra profit by using knowledge of acquisition based on public information. Design/Methodology/Approach: Using data from Warsaw Stock Exchange (quotations), typical measures such as rate of return, standard deviation (risk), correlation and transaction volume changes were calculated. Each of the case results obtained for the company was compared with the result for stock market indexes: WIG (Warszawski Indeks Giełdowy – main WSE index), WIG20 (WSE sub-index of the 20 largest companies), mWIG40 (WSE sub-index of 40 medium companies) and sWIG80 (WSE sub-index of 80 small companies). In addition, the outcomes were confronted with public news (from WSE Electronic System for Information Transfer). Findings: Conducted research has shown that generally successful finalisation of acquisition results in changes of stock prices behaviour. Unfortunately, observed reactions were not the same. Acquisitions induced both increases and decreases in stock prices; there was also no rule in case of risk change. Generally, acquisitions and merges had rather good influence in banking sector (which is still concentrating), but there was no common reaction in other sectors. Originality/Value/Practical Implications: The results will be useful for investors acting on Warsaw Stock Exchange, especially for individual investor who are not able to carry out detailed analyses. The research provides results including possible pre-effects and after-effects of making big acquisition by a large company. The negative market reactions were also shown.

scholarly journals The ability of cash flows to predict the earning: Evidence from Jordan

2021 ◽  
Vol 18 (4) ◽  
pp. 36-44
Author(s):  
Mohammad Fawzi Shubita
Keyword(s):  
Stock Exchange ◽  
Predictive Ability ◽  
Cash Flows ◽  
Operating Cycle ◽  
Prediction Ability ◽  
Future Earnings ◽  
Industrial Companies ◽  
Amman Stock Exchange ◽  
Great Support ◽  
The Relationship

This study aims to investigate the ability of cash flows components to predict the earning and to know the extent of the relationship between accounting profits and cash flow measures. The study sample consisted of 77 industrial companies listed on the Amman Stock Exchange in Jordan for the period from 2006 to 2019. This study relied on the regression method to test the relationship between the study variables. The study findings showed that the cash flows from operating, investing, and financial activities have a statistically significant impact on predicting future earnings. The study also examined the effect of length of operating cycle and company’s size on the predictive ability of cash flows regarding future earnings. The main results for this aspect are that large companies and short operating cycle companies have higher prediction ability for future earnings than small and long operating cycle companies. This paper provides evidence of the information content of cash flows for future earnings in emerging markets like Jordan and is important for Jordanian shareholders by enabling them to evaluate company’s performance. AcknowledgmentsI would like to thank Amman Arab University for its great support, and for funding this study.

scholarly journals CORPORATE GOVERNANCE DAN MANAJEMEN LABA RIIL PERBANKAN ISLAM INDONESIA DAN MALAYSIA

2018 ◽  
Vol 7 (4) ◽  
Author(s):  
M. Zubaedy Sy ◽  
Nuryati Nuryati ◽  
Surifah Surifah
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Audit Committee ◽  
Stock Exchange ◽  
Cash Flows ◽  
Profit Sharing ◽  
Least Square ◽  
Real Earnings Management ◽  
Annual Reports ◽  
Islamic Banks

 The main objective of this research is to create good corporate governance that is able to restrictopportunistic REM. The specific objectives of this study are 1) to provide evidence of difference inthe practices of CG and REM in Indonesian and Malaysian Islamic banks,and 2) to provide empirical evidence of the influence of CG on the REM of Indonesian and Malaysian Islamic banks.           The study was conducted on Indonesian and Malaysian Islamic banks from 2011 to 2016by using purposive samplingmethod. The research data is secondary data in the form of annual reports and financial reports originating from the Indonesian Banking Directory, the Indonesia Stock Exchange and the Malaysia Stock Exchange. The analysis method used to test the differences between CG and real earnings management is the Man Whitney test whilethe method used to test the effect of CG on the REM of Islamic Banks in Indonesia and Malaysia is the multiple regression analysiswithordinary least square.            The results show that the practices of corporate governance in Indonesia and Malaysia have their own strengths and weaknesses. CG mechanism of Indonesia and Malaysia shows lower level in some parts and higher level in other parts. Malaysia’s REM islower than Indonesia’sREM through operating cash flow, investment profit sharing, and discretionary costs. The experimental results show that CG generally does not affect real earnings management and only the independent audit committee who is able to restrictreal earnings management through operating cash flows.            Riset ini  menguji  hubungan antara corporate governance (CG) dan manajemen laba berdasar aktivitas riil  atau disebut real earnings management (REM) bank-bank Islam  di Indonesia dan Malaysia. Tujuan jangka panjang riset ini adalah terciptanya good corporate governace yang mampu membatasi REM oportunistik. Target khusus penelitian ini adalah 1) memberi bukti empiris perbedaan praktik CG dan REM bank Islam  Indonesia dan Malaysia. 2) memberi bukti empiris pengaruh CG terhadap REM bank Islam  Indonesia dan Malaysia.             Metode penelitian menggunakan metode ilmiah - kuantitatif, dengan membangun satu atau lebih hipotesis berdasarkan pada suatu struktur  atau kerangka teori dan kemudian menguji hipotesis-hipotesis tersebut secara empiris. Penelitian dilakukan pada bank Islam  Indonesia dan Malaysia periode waktu 2011 sampai 2016. Metode pengambilan sampel secara purposive sampling. Data penelitian merupakan data sekunder berupa  annual report dan laporan keuangan yang berasal dari Directory Perbankan Indonesia, Bursa Efek Indonesia  dan Bursa Efek Malaysia.  Teknik analisis untuk menguji perbedaan CG dan manajemen laba riil adalah uji beda Man Whitney, sedangkan untuk menguji pengaruh CG terhadap REM Bank Islam  Indonesia dan Malaysia menggunakan analisis regresi berganda ordinary least square.            Hasil menunjukkan bahwa praktik corporate governance Negara Indonesia dan Malaysia, masing masing memiliki kelebihan dan kelemahan. Mekanisme CG ada yang lebih rendah, maupun lebih tinggi antara Negara Indonesia dengan Malaysia. REM Malaysia lebih rendah signifikan dari pada Indonesia, baik melalui arus kas operasi, bagi hasil investasi, maupun biaya diskresioner. Hasil uji menunjukkan bahwa pada umumnya mekanisme CG tidak berpengaruh terhadap manajemen laba riil. Hanya Independensi komite audit yang mampu menekan manajemen laba riil melalui arus kas operasi.Keywords:Corporate governance, real earnings management, Islamic banking.

scholarly journals The impact of ownership type on the relationship between corporate governance and earnings management: An empirical study

2019 ◽  
Vol 16 (4) ◽  
pp. 31-44
Author(s):  
Ahmed Boghdady
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Cash Flows ◽  
Real Earnings Management ◽  
Ownership Type ◽  
Moderation Effect ◽  
Corporate Governance Mechanisms ◽  
The Impact ◽  
The Relationship ◽  
Privately Owned

This study investigates the effect of ownership type on the relation between corporate governance and earnings management. While previous literature has mainly examined the relationship between corporate governance and both accrual and real earnings management, no study to date, to the researcher’s best knowledge, focused on the moderation effect of ownership type on this relationship. Three proxies for measuring accrual and real earnings management, namely discretionary accruals (DA), abnormal cash flows (ACFO), and abnormal discretionary expenses (ADISX) are employed. Three empirical models (i.e. DA, ACFO, and ADISX) are developed in which the earnings management proxies represent the dependent variables and are tested using a sample of non-financial companies containing state-owned and privately owned companies over the period from 2010 to 2017, with 1030 firm-year observations. The results show a positive relationship between ownership type and both accruals manipulation and sales manipulation. In general, the results suggest that the ownership type moderates the relationship between corporate governance and earnings management. The results suggest also that corporate governance mechanisms may not play an almost the same role in monitoring and mitigating real earnings management (REM) practices as they do for accrual earnings management (AEM) in Egypt. Moreover, no evidence is found supportive of the trade-off effect which means that managers in Egyptian firms use both types of earnings management jointly to reach the target levels of earnings

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