This study aims to explore the effect of earnings management on the unexpected stock returns of the corporations listed on the Palestinian Exchange during the period 2014–2019. Earnings management was measured using the Modified Jones Model corrected for operating cash flow, while unexpected stock returns are estimated as the difference between the actual return and the average of the past three years’ returns to proxy for expected earnings. The data was obtained from the annual reports of the non-financial companies listed on PEX. The final sample consists of 31 firms and 186 firm-year observations. The results revealed that a strong positive relationship exists between earnings management and unexpected stock returns.

Conference Title

Explore Business, Technology Opportunities and Challenges ‎After the Covid-19 Pandemic

Conference Country

Jordan

Conference Date

May 1, 2022 - Jan. 1, 2025

Conference Sponsor

جامعة النجاح وجامعة الزرقاء الاهلية