The Impact of Creative Accounting Practices on Financial Performance in Industrial Companies listed on Amman Stock Exchange

Authors

Khaleel Ibrahim Al-Daoud, Department of Accounting, Business School Faculties, Al Ahilya Amman University, Amman, JordanFollow
Riyad Neman Darwazah, Department of Accounting, Business School Faculties, Al Ahilya Amman University, Amman, JordanFollow
Abeer Fayez Al-Khoury, Department of Accounting, Business School Faculties, Al Ahilya Amman University, Amman, JordanFollow
Ahmad Hafeth Ismail, Department of Accounting, Business School Faculties, Al Ahilya Amman University, Amman, JordanFollow

Abstract

The study sought to determine the effects of creative accounting practices on financial performance of industrial companies listed on the Amman Stock Exchange (ASE). In order to fulfill the study’s goals, the primary data were collected from the financial statements of 42 industrial companies listed on ASE. Moreover, a multiple regression analysis was used to examine the study’s hypotheses. The study’s results revealed that creative accounting practices, which were income smoothing and earnings management, impacted financial performance that was measured by the return on assets and the return on equity. Therefore, the researchers recommend managers to pay attention to the levels of earnings management and income smoothing practices in evaluating the financial performance of industrial companies.

Recommended Citation

Ibrahim Al-Daoud, Khaleel; Neman Darwazah, Riyad; Fayez Al-Khoury, Abeer; and Hafeth Ismail, Ahmad (2023) "The Impact of Creative Accounting Practices on Financial Performance in Industrial Companies listed on Amman Stock Exchange," Information Sciences Letters: Vol. 12 : Iss. 5 , PP -.
Available at: https://digitalcommons.aaru.edu.jo/isl/vol12/iss5/13