The purpose of this research is to investigate the moderating role of corporate governance on the relationship between earnings management and debt level in capital structure. The paper used a hypothesis-testing research approach to gather data from the annual reports of 13 industrial companies listed on Palestine Exchange and 25 Jordanian companies listed on Amman Stock Exchange from 2013 to 2020. Descriptive and inferential statistics were employed, along with correlation analysis to evaluate linear relationships between variables. The fixed and random effect regressions were utilized to develop the research model. In the case of Palestinian manufacturing firms, the results revealed that Earnings Management (EM) had a significant negative impact on debt level. According to the moderating role of Corporate Governance (CG), larger boards and the existence of female members on the board of directors causes an increase in the high-leverage impact of EM, whereas CEO duality mitigates the high-leverage impact. However, in the case of Jordanian manufacturing firms, EM showed an insignificant impact on debt level. Regarding the moderating role of CG, it was proved that the presence of female members on the board of directors increased the firm’s reliance on debt financing as a result of EM practices, while institutional investors mitigate the effect of EM on debt financing, leading to a decrease in reliance on debt. The findings of this research are suitable for the regulators while formulating policies on the Corporate Governance and the Impact of Earnings Management on Capital Structure. These findings have guided the policymakers that they should enhance their focus on Palestine and Jordan companies to test Corporate Governance Moderates the Impact of Earnings Management on Capital Structure. This study is also helpful for the new researcher while investigating this area in the future.

This research examines the value relevance of real profit using Economic Value Added (EVA) as a proxy versus accounting outcomes. The question at hand is whether the usefulness of real income numbers is superior to accruals (traditional performance indicators) for Palestinian corporations. This research utilized an experimental research design to gather panel data from the reported annual data of 31 non-financial listed corporations on the PEX from 2015 to 2019. Descriptive statistics and the Jarque–Bera test were used, along with a Nonparametric Spearman's rho Correlations test to evaluate linear relationships between variables. The Random Effect Model (REM) was used based on the Correlated Random Effects - Hausman Test to establish a concrete research model. The findings demonstrate that the market values of shares have a strong relationship with traditional measures, where the relative informativeness ability of accounting indicators is greater than the informativeness ability of real income. The study suggests using EVA as a supplement, not a replacement, for the current traditional accounting performance measurements. Future studies can compare the effect of real income and accounting indicators on a variable other than stock market value. As a policy implication, we advise users in Palestine to consider accruals but economic income indicators as supplementary. This paper is the first in Palestine to use advanced econometric analysis that establishes concrete findings about the conflict between Accounting-Based versus Economic-Based indicators.