Management engages in earnings manipulation for different reasons. This article argues that low-growth firms with high free cash flow will opt for income-increasing earnings management in order to obscure the low profits derived from their investments in negative net present value (NPV) projects. On the other hand, we argue that the listed companies might be interested in being listed in the first market due to its privileges and to preserve the competitiveness, through managing their earnings upwardly, so that they can satisfy the condition of achieving a particular earnings limit. This article should advance the body of earnings management literature in the Jordanian context by examining the effect of the moderating role of an independent audit committee (IAC) in the association between surplus free cash flow (SFCF) and income-increasing discretionary accruals (DAC). Further, this is the initial empirical attempt to investigate the moderation effect of IAC between stock market segmentations (SMS) and positive DAC. The results of this current study offer original and beneficial information for the Jordanian government and other countries with a similar institutional environment because the study promotes the application of applying IAC as an efficient tool to constrain management behaviour towards manipulation of the accruals. On top of that, this research offers information concerning the prevailing situation of earnings management practices and corporate governance in Jordan, in which shareholders, local and international investors, policymakers, regulators and academic researchers are interested. Finally, panel data analyses and various statistical techniques are employed to derive conclusions.

The purpose of this paper is to show the relative impact of liquidity, leverage, and solvency on profitability of industrial enterprises listed on the Amman Stock Exchange to ascertain which of them has the most effect on profitability. To reach the objectives of this study, 44 Jordanian industrial companies are examined from 2012 to 2018. Return on assets (ROA) and return on equity (ROE) are examined as measures of performance, current ratio and quick ratio as measures of liquidity, debt ratio and debt to equity ratio as measures of leverage, and the interest coverage ratio as a measure of financial solvency. Multiple regression analysis was used to check the hypotheses. A negative and statistically significant impact was found at the 1% level between financial leverage and profitability. At the same time, findings did not show the same for the effect of liquidity and solvency on profitability. In addition, leverage has the highest relative impact among independent variables on profitability, followed by solvency and then liquidity. Moreover, it is indicated that company size is a control variable of the effect between liquidity, leverage, and solvency on performance. Thus, it is concluded that management of industrial companies should reduce dependence on debt to finance companies to achieve the highest possible returns; it is recommended to maintain an acceptable level of liquidity to ensure the continuity of companies and attention to the level of solvency within companies to maintain a high financial performance.

This research intends to demonstrate the potential integration of large language models (LLMs) in accounting practices in Jordan. It is a mixed methods study that employs semi-structured interviews and content analysis of published financial reports. A total of 13 semi-structured interviews are conducted with various accounting professionals, such as accountant, financial analyst, financial controller, auditor, tax consultant, and finance manager. In addition, the study includes a thorough content analysis of financial reports, which reveals a compelling pattern highlighting the distinct narrative content richness prevalent across financial, industrial, and service sectors. The results emphasize the need for sector-specific adaptation, suggesting a paradigm shift in financial reporting practices. This study represents the initial empirical exploration in Jordan. It serves as a bridge between theory and application, offering both theoretical insights and practical guidance for accounting professionals. Ultimately, the study envisions a future where LLMs significantly enrich financial reporting practices across diverse sectors.

This research investigates how the characteristics of a risk management committee (RMC), as a recently emerging sub-committee within the board of directors, impact firm performance indicators. The investigation employs a dataset encompassing service and manufacturing firms that are listed on the Amman Stock Exchange (ASE) over the period 2019–2022, comprising a total of 236 firm-year observations. The primary statistical technique utilised in the study is fixed-effect regression with Huber–White standard errors. The findings demonstrate that RMC attributes such as size, independence and meeting frequency exert a significant and positive effect on return on assets, return on equity and Tobin’s Q. These insights hold practical implications for stakeholders, regulators and policymakers in assessing the influence of RMC characteristics on firm performance within the context of the ASE. Understanding these dynamics can inform decision-making and regulatory frameworks, promoting effective risk management practices in publicly traded corporations. The current study represents the initial empirical exploration within the corporate governance literature concerning the nexus between RMC qualities and firm performance in Jordan.

This research provides evidence on whether enterprise resource planning (ERP) implementation affects accrual-based earnings management (AEM) in the service and manufacturing firms listed on the Amman Stock Exchange (ASE). The Huber–White’s sandwich estimator for pooled ordinary least squares (OLS) regression was utilized for this investigation as the primary statistical technique. Using three different AEM models and a sample of 390 firm-year observations for the period spanning from 2015 to 2019, this study reveals a significant and negative nexus between ERP implementation and AEM. The findings show that ERP adopting firms are less likely to engage in AEM practices than ERP non-adopting firms. In terms of contribution, the present research is considered among the first to investigate the impact of ERP system adoption on earnings management (EM) in Jordan.