Earning Management

4183 Words17 Pages
Does the Commercial Banking Industry of UAE Practice Earnings Management Dr. Mohammed Obeidat Introduction It is the right of external users of accounting information to be provided with more adequate information to protect their interests. Many questionable issues concerning the term of earnings management are still available. Auditors, accountants, financial analysts, and other concerned parties may hold the responsibility of detecting external users from the practices of earnings management. Many questionable issues are still available regarding the term of earnings management. Some people may have no enough idea about what practices are classified under earnings management, and what practices can not be classified under this…show more content…
This study depends on cross sectional data because a time series data will misstate the data, so it is unique in its inputs of data. This paper is organized as follows: The first section defines earnings management, and describes the incentives of its practices by commercial banks, in addition to that, it explores the methods of practice and how these practices can be defected. The second section explores the most related prior researches. The third section presents the hypotheses of the current research. The fourth section describes the followed methodology in the current study. The fifth section presents the results, while the fifth explores the findings. Literature Review and Prior Researches Many people believe that the term of earnings management is understandable in its simple form, but most of those unable to determine whether a selected practice is an earnings management or not. Understanding what earnings management constitutes and why it takes place is important for all users of accounting information. This study highlights the different aspects of earnings management, so it identifies clearly this term, and presents the incentives standing behind its practice. Moreover, the current study determines the methods of earnings management used by firms, and explores how these practices can be detected. Earnings management is defined as the "intentional misstatement of earnings leading to bottom line numbers that would have been different in the absence
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