Exploitation of Earnings Management Concept to Influence the Quality of Accounting Information: Evidence from Jordan

This study aims to understand the nature impact of earnings management practice on the quality of accounting information in Jordan.The study used the quantitative technique to gather the data by using a questionnaire to understand the users’ attitudes about earnings management practice in Jordan and how this practice influences the quality of accounting information. To discover this issue, the researcher documented several criteria to identify the concept of "earning management'' and define the variables to measure it. The study states that all accounting information users believe that the earnings management practice is used by some companies in Jordan. They stated how the practice affects the quality of accounting information by detecting a significant effect of earnings management, which in turn has an impact on users' decisions, such as investors, financial analysts, and creditors. In addition, the study’s outcome specified that earnings management has an important influence on accounting information quality. Most companies resort to using earnings management techniques to meet shareholders’ wants, financial analysts’ expectations for the company's performance, or management’s desire to increase the net income which in turn increases the rewards they receive or to achieve their personal interests that resulted from agency problems. Finally, earnings management is considered a form of accounting manipulation practiced without breaching laws and standards.The consequences of the current study help users of financial reports, such as managers and investors, detect an effect of earning management on users’ decision making.It is believed that there is no Jordanian study to date examining the impact of earnings management on the quality of accounting information. Therefore, this study significantly contributes to the limited literature on the exploitation of the earnings management concept to influence the quality of accounting information in developing countries.The difficulty with using a questionnaire in developing countries, such as Jordan, also there are a number of users who do not care about the results of the study Keywords: Earnings management, real activity manipulation, accrual manipulation, consequences of earnings management, quality of accounting information, reasons for earnings management applications