WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 21, 2024
The Effect of Real-Profit Management Operations on the Market Returns of Jordanian Industrial Enterprises’ Shares
Authors: Khaled Eriej Aburisheh, Laith Akram Muflih Al-Qudah, Ashraf Mohammad Salem Alrjoub, Faris Alkarabsheh, Leqaa Naife Al-Othman, Hani Al-Azab
Abstract: This research aims to examine the impact of actual earnings management activities on stock market returns. The study utilizes data from 56 industrial corporations listed on the Amman Stock Exchange (AXE) between 2011 and 2020. After removing entities with insufficient data, the sample size was reduced to 43 enterprises. The research findings indicate a significant positive relationship between actual earnings management activities and the market returns of industrial enterprise shares. This study contributes to the existing literature on earnings management by providing evidence on real activity manipulation, which has received less attention so far. Real activity manipulation refers to management actions that deviate from typical business operations to achieve specific profit targets. The significance of this research lies in its contribution to understanding the role of actual earnings management activities in influencing market returns. The results have implications for investors, regulators, and financial analysts, who can use this knowledge to make informed investment decisions, monitor financial reporting practices, and identify potential earnings management activities.
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Keywords: profit management, market returns, Jordanian industrial enterprises
Pages: 130-142
DOI: 10.37394/23207.2024.21.12
WSEAS Transactions on Business and Economics, ISSN / E-ISSN: 1109-9526 / 2224-2899, Volume 21, 2024, Art. #12