PROPOSING A MODEL FOR LIMITING EARNING MANAGEMENT PRACTICES: THE CASE OF JORDANIAN LISTED FIRMS

Corporate Board: Role, Duties & Composition

关键词: Jordan;    CEO Duality;    Political Influence;    Earnings Management;   

DOI  :  10.22495/cbv12i3art9

学科分类：社会科学、人文和艺术（综合）

来源: Virtus Interpress

【 摘 要 】

The key objective of this paper is to propose a model for limiting earning management practices among manufacturing firms in Jordan. In order to do so, two independent variables are examined in this paper, namely, political influence and CEO Duality. Discretionary total accruals according to the modified Jones model (1991) was used in order to estimate the level of earnings management, which is the dependent variable. The sample comprised 64 companies for the financial year 2013. The results suggest that a positive and significant association existed among both political influence and CEO duality and earning management. This means that both independent variables exacerbated earnings management. Further research is required to determine what urgent legislation should be developed to restrict the presence of members who have political connections on the board of directors. Also, the need exists for the separation of roles of Chairman and CEO to ensure the independence and complying with the requirements of corporate governance.

【 授权许可】

CC BY-NC