The Role of Earning Management through Income and Accrual items the Relevance of Accounting Information

Useful information is information that has qualitative features. One of these features is relevance. Relevance means that accounting information must have the ability to make a difference in a decision. The main purpose of this experimental study is to determine the effect of earning management on the relevance of accounting information value. To measure earnings management, revenue items and accruals have been used. The statistical population of this research is the companies accepted in the TSE. The data of this study consisted of 1860 firm-years from 2006 to 2017. The research method is correlational and causality and the hypotheses were tested, using correlation and regression. The results showed that earnings management by way of income items reduced the relevance of the stock value of the stock. Also, the results showed that the management of profit through the manipulation of accruals had a significant effect on the relevance of book value and accounting profit. In general, research results show the effect of earnings management through accruals and items of income on the relevance of accounting profit and stock value. Therefore, the evidence obtained in this study shows that the manipulation of accruals and earnings items is associated with a reduction in the quality of accounting information appropriate.