The effect of the ownership structure on earnings management practices

Abstract

The objective of this study is to investigate the effect of the ownership structure, which includes concentration ownership, institutional ownership and foreign ownership in the light of the debt ratio and company size as controlling variables in limiting the earnings management practices of the Jordanian industrial companies for the period 2012–2016. The hypotheses of the study were tested using the multiple regression models. Among the most prominent findings of the study are: the explanatory factor (R2) for the independent and control variables accounts for 38% of the change in the earnings management of the Jordanian industrial companies, moreover, a significant effect of the concentration ownership was found in the limitation of earnings management practices; while, there was no significant influence of institutional ownership and foreign ownership on the earnings management practices in Jordanian industrial companies. Major limitation to this study is the only considered listed industrial Jordanian firms. Thus, the generalization of the results to other sectors and diverse economic conditions and regulations may be constrained. Finally, Jordanian policymaker reform policies motivate companies to increase their interest on concentration ownership structure, as the study showed the significant effect of the concentration ownership in the limitation of earnings management practice.

Pengaruh Struktur Kepemilikan dan Kualitas Audit terhadap Manajemen Laba

“…Menurut Maswadeh (2018) struktur kepemilikan merupakan salah satu mekanisme GCG untuk mengurangi kemampuan manajemen dalam bertindak opportunistic. Obaidat (2018) mengklasifikasikan struktur kepemilikan menjadi kepemilikan manajerial, kepemilikan institusional, kepemilikan asing, dan konsentrasi kepemilikan.…”

“…Pengetahuan akuntansi dan tata kelola perusahaan yang dimiliki investor asing dapat digunakan sebagai system pengawasan yang bagus untuk diterapkan dalam meminimalisir manajemen laba oleh pihak manajemen. Pemilik asing tertarik pada pengungkapan dan praktik keuangan yang memiliki kualitas serta performa baik sehingga mendorong manajemen meningkatkan kualitas pelaporan keuangan (Maswadeh, 2018). Semakin kecil kepemilikan asing, semakin besar motivasi manajer melakukan manajemen laba (Nguyen et al, 2021).…”

“…Penelitian ini tidak sejalan dengan penelitian yang dilakukan oleh Nguyen et al, (2021) dan Kurawa et al, (2021) yang menyatakan bahwa kepemilikan asing berpengaruh negatif terhadap manajemen laba. Sebaliknya, penelitian ini sejalan dengan dengan penelitian yang dilakukan oleh Faranita & Darsono, (2017), Maswadeh, (2018, dan Hadi & Tifani (2020) yang menyatakan bahwa kepemilikan asing tidak berpengaruh terhadap manajemen laba.…”

أثر هیکل الملکیة وهیکل التمویل على إدارة الأرباح: دراسة تطبیقیة على الشرکات المدرجة فی سوق الأوراق المالیة المصری

“…Consequently, this paper contributes to the limited literature by suggesting a new model for the effect of of ownership structure and capital structure on earnings management. Hassan et al 2018;Lassoued et al 2018;Maswadeh, 2018;Mindzak & Zeng, 2018;Osemene et al 2018;Tessema et al 2018…”

The Effect Of Managerial and Institutional Ownership Towards Earnings Management With Profitability As Moderating Variable

“…Previous studies mostly researched earnings management, as done by Zakia et al (2019) and Maswadeh (2018) which stated that managerial ownership and institutional ownership did not affect earnings management and profitability positively affected the earnings management. Arthawan and Wirasedana (2018) have different findings which stated that managerial ownership negatively affected the earnings management, while Arlita et al (2019) explained in their research that institutional ownership and managerial ownership positively affected earnings management.…”