MEASURING FINANCIAL REPORTING QUALITY OF NON-FINANCIAL FIRMS LISTED IN AMMAN STOCK EXCHANGE

Authors : Mohammad ALAHMAD, Dilek TEKER

Pages : 245-245

Doi:10.17261/Pressacademia.2023.1711

View : 12 | Download : 7

Publication Date : 2023-02-01

Article Type : Research Paper

Abstract :Purpose- The purpose of this study is to measure financial reporting quality of non-financial firms listed in ASE. As the financial information accuracy and transparency is vital for internal and external users, this study insures that financial reporting quality and financial information published for non-financial firms in ASE is not manubulated, accurate, combitable, timely published, adequate, and free of earning management, to be usefull for decision making for all users, especially for new investors. Methodology- The period 2010 – 2019 forms the data for the statistical analysis. In addition, and to measure the FRQ, the paper uses time series analysis techniques, including descriptive analysis, frequencies and multiple OLS regression were used. Using data from 910 firm-years observation of companies listed on Amman Stock Exchange for the period of 2010 to 2019. Findings- The analysis reveals that The probability for F-Statistics < 0.05, this led to accept the statistical model. on the other hand, R square is 31.3 % which means that the explanatory power of modified Jones model insert ignore into journalissuearticles values(Dechow et al., 1995); reach 31.3% in explain the practices of earnings management in Jordanian companies. on the other hand, the VIF values are lower than 10 and tolerances higher than 10% which mean there is no multicollinearity problem in the model. as for the 1/A_insert ignore into journalissuearticles values(i,t-1); shows a significant and negative relationship with total accruals, were 〖∆insert ignore into journalissuearticles values(Sales-AR);〗_it/A_insert ignore into journalissuearticles values(i,t-1); and 〖PPE〗_it/A_insert ignore into journalissuearticles values(i,t-1); 1/A_insert ignore into journalissuearticles values(i,t-1); shows a significant and positive relationship with total accruals. Conclusion- the highest number of companies practicing earnings management in the year insert ignore into journalissuearticles values(2012 and 2014); was 60%, while the lowest number of companies that practice earnings management in the year insert ignore into journalissuearticles values(2015); and it was 32%, on the other hand, the highest number of companies do not practicing earnings management in the year insert ignore into journalissuearticles values(2015); was 68%, while the lowest number of companies that do not practice earnings management in the year insert ignore into journalissuearticles values(2012 and 2014); and it was 40%.
Keywords : FRQ, modified jones model, Amman Stock Exchange, non financial firms