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The Effects of Earnings Quality, Conservatism, and Real Earnings Management on the Company's Performance and Information Asymmetry as a Moderating Variable

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  • Nera Marinda Machdar

    (Department of Accounting, Faculty of Economics, Kalbis Institute, Jl. Pulomas Selatan Kav.22, Jakarta 13210, Indonesia,)

  • Adler Haymans Manurung D. R. M

    (Department of Accounting, Faculty of Economics, University of Bina Nusantara, Jl. Hang Lekir I No. 6, Senayan, Jakarta 10270, Indonesia,)

  • Etty Murwaningsari

    (Department of Accounting, Faculty of Economics, University of Trisakti, Jl. Kyai Tapa No. 1. Grogol. Jakarta 11440, Indonesia.)

Abstract

This study investigates the role of information asymmetry as a moderating variable to strengthen or to weaken the effects of earnings quality, conservatism, and real earnings management on the company's performance. This study utilized data from Indonesia and Singapore for years 2004- 2013. The results suggest that earnings quality positively affects the company's performance; however accounting conservatism does not affect the company's performance and real earnings management negatively affects the company's performance. Moreover, information asymmetry weakens the effects of earnings quality and conservatism on the company's performance but strengthens the effect of real earnings management on the company's performance.

Suggested Citation

  • Nera Marinda Machdar & Adler Haymans Manurung D. R. M & Etty Murwaningsari, 2017. "The Effects of Earnings Quality, Conservatism, and Real Earnings Management on the Company's Performance and Information Asymmetry as a Moderating Variable," International Journal of Economics and Financial Issues, Econjournals, vol. 7(2), pages 309-318.
    • Handle: RePEc:eco:journ1:2017-02-42
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    References listed on IDEAS

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    Cited by:

    1. Nguyen Van Nguyen & Quang Linh Huynh, 2019. "The Importance of Earning Quality and Organizational Reputation to Financial Effectiveness," International Journal of Asian Social Science, Asian Economic and Social Society, vol. 9(7), pages 406-416, July.
    2. Deden Tarmidi & Etty Murwaningsari & Haryono Umar & Sekar Mayangsari, 2020. "The Influence of Tax Compliance and Earnings Quality on Financial Performance (Evidence from Indonesia and Thailand)," International Journal of Emerging Trends in Social Sciences, Scientific Publishing Institute, vol. 8(2), pages 70-74.
    3. Fares Alsufy & Malik Abu Afifa & Mohammed Zakaria Soda, 2020. "Mediating Effects of Liquidity in the Relationship between Earnings Quality and Market Value of the Share Price: Evidence from Jordan," Review of Applied Socio-Economic Research, Pro Global Science Association, vol. 19(1), pages 17-32, June.
    4. Zhen-Jia-Liu, 2021. "Effect Of Fuel Price Volatility On Real Activities Earnings Management In Airlines Related To Fuel Price Hedging," Economics and Management, Faculty of Economics, SOUTH-WEST UNIVERSITY "NEOFIT RILSKI", BLAGOEVGRAD, vol. 18(1), pages 33-53.

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    More about this item

    Keywords

    Earnings Quality; Conservatism; Real Earnings Management; The Company's Performance; Information Asymmetry;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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