Influence Of Earnings Management On Financal Performance Of Agricultural Firms Listed In Nairobi Securities Exchange

This study assessed the effects of firms' characteristics on earnings management of listed companies in Nigeria. To achieve the objectives of this study, a total of 20 listed firms in the Nigerian stock exchange market were selected and analyzed for the study using the judgmental sampling technique. The corporate annual reports for the period 2006-2010 were used for the study. In testing the research hypothesis, the study adopted the use of both descriptive statistics and econometric analysis using the pooled ordinary least square regression for the listed sampled firms. Findings from the study revealed that while firm size and firms' corporate strategy have a significant positive impact on earnings management (proxied by discretionary accruals); on the other hand, the relationship between firms' financial leverage and discretionary accruals of the sampled firms in Nigeria was not significant. Thus, the study concludes that large firms tend to have higher motivations and more prospects to engage in the manipulation earnings and exaggerate earnings due to the intricacy of their operations and the complexity for users to identify overstatement. This study contributes to existing literature by providing a more robust model (framework) that analysis the effects of firm size, firm leverage and corporate strategy on firms' earnings management in Nigeria.

Purpose:The main objective of this study is to examine the effect of earnings management on EPS and BVPS. The issue of earnings management is becoming quite rampant in organisations, following notable failures of companies as Enron, WorldCom, Tyco, etc. and moreover, the Cadbury, African Petroleum, and failed Banks in Nigeria. Design/Methodology: The study was descriptive in nature and made use of ex-post facto research design. The population of the study was drawn from companies quoted under the conglomerates section of the Nigerian Stock Exchange (NSE) as shown in the Stock Exchange Factbook of 2013. Earnings Management was estimated using Jones (1991) Model. Our dependent variables were Earnings Per Share (EPS) and Book Value Per Share (BVPS). Findings:The results show that for firms with high discretionary accruals, earnings management positively affects earnings per share; and, book value per share of the firms. Recommendations:Based on this the study recommends that the establishment and implementation of policies and practices that can curtail earnings management in Nigerians firms; and, the safeguard of investor return through the adoption and use of International Financial Reporting Standards in other sectors.

Jurnal Riset Akuntansi Terpadu

This study aims to analyze the effect of Tax Planning, Deferred Tax Expenses, and Tax Expenses on Earnings Management. The independent variables in this study are tax planning, deferred tax expense, and current tax expense, while the dependent variable is earnings management which is measured by capitalization rate as a proxy for the market value of equity. The population of this research is the consumption companies of the Food and Beverage Sub-Sector which are listed on the Indonesia Stock Exchange from 2011-to 2020. The sampling technique was purposive sampling. And obtained 12 companies. The type of data used is secondary data in the form of the company's annual financial statements obtained from the IDX website or company website. Data analysis using multiple linear regression test with the help of SPSS software version 24. The results of this study reveal that tax planning partially does not affect earnings management. Meanwhile, deferred tax expenses and current tax expenses partially affect earnings management. Simultaneously tax planning, deferred tax expense, and current tax expense affect earnings management. This third independent variable is useful for consideration and evaluation in conducting earnings management.

2016

The purpose of the study was to investigate the determinants of earnings management practice among non-listed firms in the motor industry in Kenya. The study specifically sought to establish the influence of contracting motivations, presence of bonus systems, industry performance and regulatory requirements on earnings management among Non-listed firms in the Motor Industry in Kenya. The study review was based on three theories: that is the prospect theory, stake holder’s theory and the big bath theory which is relevant to the study .This study employed a descriptive research design. A census was conducted on all the 38 motor companies registered by Kenya Motor Industry Association (KMIA) as at 2015. A multiple linear regression model was used to test the significance of the selected determinants of the earnings management practice in motor industry in Kenya. The study findings indicated that contracting motivations, presence of a bonus system and regulatory requirements were positi...

2021

Earnings management uses acceptable accounting rules and procedures, as well as evading business practices, in order to achieve desired ends. It is a form of a financial report designed by management, presented so as to obtain a private gain of some kind. There are two basic motives: opportunistic and efficient motives. Opportunistic motives are those implying that managers use their decisions to maximize their personal gains. In efficient motives, manageress window-dress a financial report so as to signal information to the users of the report (Cudia & Dela Cruz, 2018, 120). The implication of both motives is that management do not present the firm’s true economic position (Emudainohwo, 2020, 397). Rather, they mislead stakeholders, as well as prospective investors, by signaling false information about the firm’s performance as if it were true (Beaver, 2002, 468). DETERMINANTS OF EARNINGS MANAGEMENT: THE STUDY OF NIGERIAN NONFINANCIAL COMPANIES

NEWPORT INTERNATIONAL JOURNAL OF CURRENT RESEARCH IN HUMANITIES AND SOCIAL SCIENCES, 2023

The study examined the impact of accounting information on the financial performance of agricultural firms listed on the Nairobi Securities Exchange (NSE). A descriptive study design was used, with primary data collected through questionnaires. Quantitative analysis was conducted using SPSS V24 for both descriptive and inferential statistics. The results showed a significant correlation between financial reporting disclosures and the financial performance of agricultural firms listed on the NSE. The study concluded that efficient and timely financial reporting disclosures significantly influence the financial performance of agricultural firms listed on the NSE. The recommendation is for agricultural firms to prioritize efficient and timely disclosure of information to their stakeholders to improve their financial performance. Keywords: Financial Reporting, Financial Performance, Accounting Information, Agricultural Firms and Nairobi Securities Exchange (NSE)

Atestasi : Jurnal Ilmiah Akuntansi

This research aims to provide evidence that leverage, managerial ownership, board of directors, and firm size affect earnings management. The type of research used in this research is quantitative research with a descriptive approach. The population in this study is all manufacturing companies in the food and beverage sector listed on the Indonesia Stock Exchange, which are 18 companies and disclose annual reports for 2017-2021. The data collection technique used in this study is more precisely using the purposive sampling technique so that the researcher will take 45 samples from the population. This study found that leverage, managerial ownership, and firm size positively and significantly affect earnings management. In contrast, the board of directors has a negative and insignificant effect on earnings management.

Asian Themes in Social Sciences Research

A firm's ownership structure is important to the effectiveness of monitoring the mechanisms used to manipulate earnings. Based on the ownership structure of a firm, management can feel pressure to manage earnings by manipulating the company's accounting practices to meet financial expectations. This paper focuses on how the three components of ownership structure affect earnings management of listed firms. That is to determine the effect of ownership concentration, managerial ownership, and institutional ownership on earnings management of listed firms. As per the jones and modified Jones model, discretionary accruals were used as a measure of earnings management. how did you measure the components of ownership structure The study deployed random effects model and STATA software for data analysis. Data was collected for the period from 2011 to 2019 from all listed manufacturing firms in Nairobi securities exchange. The study findings established that managerial ownership, in...

European Scientific Journal, 2015

The objective of the study was to establish the effect of corporate governance practices on earnings management of companies listed at the Nairobi Security Exchange (NSE). The target population consisted of the 49 companies that had been continuously and actively trading at the NSE between January 2010 and December 2012. Secondary data was used covering the period 2010 to 2012 and analyzed using linear regression to test the effect of the independent variables on the dependent variable. The study found that earnings management is negatively related to ownership concentration, board size and board independence but positively related to board activity and CEO duality. The study recommended the need for effective corporate governance practices in listed companies in Kenya to contribute to reduced earnings management and avert possible collapse of listed companies in Kenya.

2019

The aim of this study is to determine what factors make banking companies doing earnings management in Indonesia. Based on previous research, we identify some factors can make the company doing earnings management such as tax avoidance, leverage, company size and corporate governance components for example IO (Institutional Ownership), BOC (Board of commissioner), IC (independent commissioner). The research proved that the banking companies in Indonesia applies corporate governance to improve the quality of financial statement and avoid earnings management. These results also showed that tax avoidance, leverage, size company has no significant effect on earnings management.