THE IMPACT OF EARNINGS MANAGEMENT ON THE VALUE RELEVANCE OF EARNINGS: EMPIRICAL EVIDENCE FROM TURKEY
Journal Title: The Journal of International Social Research - Year 2017, Vol 10, Issue 51
Abstract
This empirical study focus on demonstrating the relation between of earnings and stock returns by using data from Istanbul Stock Exchange of Turkey (Borsa Istanbul-BIST). This study analyzes the presence of earnings management practices by using financial information of the Turkish listed manufacturing companies. For this purpose, it was tested that low performance companies are prone to apply income increase practices than high performance companies. It was first approved that companies with low performance employ these practices. Thereafter it was examined if these earnings management practices decrease the value relevance of earnings. To test the hypothesis a model is created to present the relation between reported earnings and stock returns. Our findings display that low performance companies tend to increase their earnings so that they can hide their low performance. Our results point out that there is significant and positive relationship between earnings and market adjusted stock returns for whole sample, however there is no significant difference between adjusted market returns of high and low performance companies. In the literature, earnings management and value relevance studies are mostly based on US data. This study is the first paper that examines the relationship between earnings management, value relevance and financial performance in Turkish manufacturing companies.
Authors and Affiliations
A. Taylan ALTINTAŞ
Keywords
Related Articles
- EP ID EP255198
- DOI -
- Views 131
- Downloads 0
A MEDICAL TEXT WRITTEN IN THE 18Th CENTURY: “NETÎCETÜ’L-FİKRİYYE FÎ TEDBÎRİ VELÂDETİ’L-BİKRİYYE”
One of the important criterions revealing the level of development of a society is, its appreciation of science and scientific output. In Ottoman Period as well as literatüre and arts, generation and development in scien...
COMMUNICATIVE FUNCTIONS OF EUPHEMISMS IN PERSIAN
In each culture, taboo domains are subject to varying degrees of constraint and prohibition. Euphemisms, on the other hand,are proper means of talking about these sensitive topics. Adopting Allan &Burridge’s (2006) pragm...
AN EVALUATION OF THE RELATIONSHIP OF IMMIGRATION AND EDUCATION: EDUCATION NEEDS OF THE SYRIAN REFUGEE CHILDREN AND CHALLENGES OF EXPOSED DELAYS IN SCHOOLING PROCESSES
The involuntary relocation of individuals, families and societies, dramatically impacts human life. Syrian citizens who have been displaced due to many disadvantages caused by war, displacement and migration caused by th...
THE POETICAL REPORT OF A LEGATION: KASIDAH OF TANNANE
The poem from the Divan of Sünbülzâde Vehbî studied in this article is a eulogium or kasidah both in the form, style and content. However with number of lines the kasidah also takes the form of the journal of legation. I...
INDUSTRIAL POLICIES AND TRANSFORMATION OF INDUSTRIAL SECTOR IN TURKEY: AN EVALUATION THROUGH PLANNED DEVELOPMENT ERA
Industrial policies are one of the most controversial topics in Economics. Industrial policies are basically the acts aside from monetary and fiscal policies that affect the sectoral structure. In Turkey, from the procla...