The Impact of Earnings Management on Dividend Policy: Empirical Analysis of Kse-100 Index Firms (original) (raw)
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Dividend policy is one of the widely addressed topics in financial management. It is an important duty of a financial manager to formulate the company's dividend policy that is in the best interest of the company. Many a time financial managers are involved in earnings management practices with the intention of adjusting dividends. The present study has been carried out to scrutinize the effect of earnings management on dividend policy. The researchers have taken the data of 86 listed companies for the year 2004 to 2009. The researchers have measured the dividend policy by using dividend payout ratio while Modified Cross Sectional Jones Model (1995) has been employed to measure the earnings management. The results of the common effect model show that there is not any significant relationship among earnings management and dividend policy. Moreover, smaller companies are paying more dividends as compared to larger companies. This study reveals that involvement of managers is not for dividend policy. There might be some other motives behind the earnings management.
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11.Earning Management and Dividend Policy Empirical evidence from Pakistani listed companies
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Earnings Management and Dividend Policy: Testing Audit Quality for the Moderating Effect
The study is about the moderating effect of audit quality on the relationship between earning management and dividend policy in manufacturing sector of Pakistan. Firms listed in Pakistan Stock Exchange (PSE) have been considered to investigate the effect of earnings management on dividend policy from 2010 to 2016 in Pakistan. The dividend policy is calculated by dividend payout ratio whereas the discretionary accruals have been used for the measurement of earning management and this is taken as a proxy to estimate the earning management. The modified cross sectional model is adopted to quantity discretionary accruals. From the analysis, it is concluded that earning management has influence on dividend policy which rejects null hypothesis of the study. The regression coefficients explain that the connection is too weak that it is most near to no connection. The reason of this no connection or influence is financial decline time period, as earning management varies annually.
Earning Management and Dividend Policy Empirical evidence from Pakistani listed companies
The study is an effort to find out the impact of earning management on dividend policy in Pakistan. A set of listed companies from Karachi stock exchange (KSE) 100 indexes have been investigated to analyze the relationship from the year 2005 to 2009 in Pakistan. Dividend policy has been measured by dividend payout whereas earning management has been quantified by discretionary accruals and discretionary accrual is used as a proxy to determine earning management. Modified cross sectional model (1995) has been used to measure discretionary accruals. Regression analysis shows that earning management has impact on dividend policy that rejects our null hypothesis. But coefficient shows that the relationship is so weak that is near to no relationship. Reason behind this no impact is economic decline period, because earning management changes every year. In the decline period our earning management was increase and the companies starts downsizing divided payment.
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