Dividend Policy and Informativeness of Reported Earnings: Evidence from the MENA Region

Farooq, Omar; Shehata, Nermeen F.; Nathan, Siva

doi:10.1111/irfi.12124

Cited by 13 publications

(19 citation statements)

References 17 publications

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“…In conjunction with their findings, this result was revealed that an increase in the discretionary accruals of the firm does not necessarily instigate growth or otherwise in the dividend policy. However, this finding opposed the results of Morghri&Galogahv (2013), (Baatour et al, 2017), Farooq (2018) and Aladwan (2019).…”

Section: Standardized Regression Path Figure 2 Standardized Structurcontrasting

confidence: 69%

“…Similarly, Savov (2006) and Chansarn & Chansarn (2016) have in their separate studies opined that large firms with huge investment tend to disclose more discretionary accrual in their reported earnings. Moreover, various findings indicated that managers attempt to engaged earning manipulation when they realize that the firm may likely not meet the required level of earning to pay the due dividend (see, Morghri & Galogah, 2013) and looking forward to increases the earning to attract more investors (Baatour, Ben Othman & Hussainey, 2017;Farooq, 2018;Aladwan, 2019).…”

Section: Relationships Between Dividend Policy and Real Earning Managmentioning

confidence: 99%

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Effects of Board Size, Board Composition and Dividend Policy on Real Earnings Management in the Jordanian Listed Industrial Firms

Shahwan¹,

Almubaydeen²

2020

IJFR

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Earning manipulation has been a normal transaction among the global businesses, in which business organization sees it as beneficial, thereby turning black eyes to its negative impact on the general economy. This study aimed at examining the impact of board size, Board composition and dividend policy on real earnings management in the listed Jordanian industries. 8 years data (2010 to 2018) was extracted from the audited financial reports of the selected firms. Data was analyzed using Structural Model via AMOS version 26 and SPSS version 21. The findings revealed a positive and significant effect between board size, board composition and real earning management at p-value<0.05 and 0.001 (two-tailed) respectively. While negative of dividend policy on REM was recorded at p-value>0.05 (two-tailed). This study has immensely contributed towards bridging the gap in the existing knowledge as it documented a new finding. The benefits of these findings cross over the managers, shareholders, board of directors, investors, the Jordanian government and all other relevant institute for the buildup of the healthiest industrial sector and better economy.

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Section: Standardized Regression Path Figure 2 Standardized Structurcontrasting

confidence: 69%

Section: Relationships Between Dividend Policy and Real Earning Managmentioning

confidence: 99%

Effects of Board Size, Board Composition and Dividend Policy on Real Earnings Management in the Jordanian Listed Industrial Firms

Shahwan¹,

Almubaydeen²

2020

IJFR

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“…For the purpose of this paper, Tobin's Q ( Q ) is used as a measure of firm performance. Consistent with prior literature, we define Tobin's Q as the market value of equity plus book value of assets minus the book value of equity, scaled by book value of assets (Foucault and Frésard, 2012; Singh et al , 2018; Farooq et al , 2018).…”

Section: Datamentioning

confidence: 99%

Agency problems and the value of advertising expenditures in an emerging market: role of product market competition

Farooq

Pashayev

2020

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PurposeThis paper documents the impact of product market competition on the value of advertising expenditures.Design/methodology/approachThe authors use the data for non-financial firms from India and the pooled regression procedure to test their arguments during the period between 2009 and 2018.FindingsThe results show that advertising expenditures of firms operating in sectors with relatively high competition are more valuable than advertising expenditures of firms operating in sectors with relatively low competition. The results of the study are robust across various proxies of advertising expenditures and firm performance. Furthermore, the results also show that the positive impact of product market competition on the value of advertising expenditures is confined only to firms that already have lower agency problems.Originality/valueThe results of the study highlight the importance of product market competition on the value of advertising expenditure in the emerging market setting, where agency problems are supposed to be high.

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“…Investors in emerging markets are particularly interested in dividend policies because dividends have significant impact on the market values of firms. Prior literature argues that dividends positively affect the value of firms by reducing the agency problems (La Porta et al, 2000;Farooq et al, 2018). In emerging markets, dividends can substitute for the monitoring roles of stakeholders.…”

Section: Introductionmentioning

confidence: 99%

Financial centers and dividend policy: evidence from an emerging market

Farooq

Aktaruzzaman

2019

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Purpose Is location in the financial center of a country significant determinant of a firm’s dividend policy? The purpose of this paper is to answer this question within the context of an emerging market. Design/methodology/approach The authors use variety of techniques (OLS regression, panel regression with random effects, TOBIT regression and quintile regression) to document the effect of location on dividend policies of Indian firms during the period between 2001 and 2016. Findings The results show significantly higher dividend payout ratios for firms headquartered in Mumbai, the main financial center of India. The results are robust for alternate proxy of dividend policy and for different sub-samples. The results also show that these results are more pronounced for firms with better information environment (firms with high analyst coverage). Originality/value To the best of the authors’ knowledge, most of the prior research overlooks how a location of firm’s headquarter in the financial center affects its dividend decisions. This paper fills this gap by documenting the relationship between the two in India.

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Dividend Policy and Informativeness of Reported Earnings: Evidence from the MENA Region

Cited by 13 publications

References 17 publications

Effects of Board Size, Board Composition and Dividend Policy on Real Earnings Management in the Jordanian Listed Industrial Firms

Effects of Board Size, Board Composition and Dividend Policy on Real Earnings Management in the Jordanian Listed Industrial Firms

Agency problems and the value of advertising expenditures in an emerging market: role of product market competition

Financial centers and dividend policy: evidence from an emerging market

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