Activating the Role of Audit Committees and Boards of Directors in Restricting Earnings Management Practices: A Perspective of Auditors in Jordan

The study objects for investigating the possibility of activating both audit committee and board of directors for restricting the practices of earnings management phenomenon. To achieve this objective, a questionnaire had been developed and self-administered for a selected sample consists of 123 auditors working in Jordan based on the simple random sampling method. The study first hypothesis is that audit committee can be activated in a form to restrict earnings management practices; the second hypothesis takes that boards of directors can be activated in a form that restricts earnings management practices. The third hypothesis states that activating both of audit committees and boards of directors together will restrict the practices of earnings management. One sample t-test, in addition to descriptive statistics had been used in data analysis and hypotheses testing. The finding of the present study show that audit committee, boards of directors, and both of audit committee and board of directors together can be activated to restrict earnings management practices.