The Impact of Accounting Investigation on Earnings Management Practices in the Algerian Business Environment

A Case Study of a Sample of Economic Institutions in the Southeast for the Period (2017-2022)

Abstract

This study aimed to highlight the impact of one of the forms of tax control, namely the
accounting investigation, on earnings management practices in the Algerian business environment.
We conducted a comparative study of the behavior of the sample institutions that were subjected to
the accounting investigation, and accordingly, the extent of their practice of earnings management
was measured during two equal time periods, measuring earnings management practices before and
after being subjected to the accounting investigation. For this purpose, the study was conducted on
a sample of 6 active institutions in the southeast, which included 36 observations during the study
period extending between (2017-2022). The Kothari model (2005, Kothari & all) was chosen to
measure earnings management practices, as the study concluded that there are substantial indicators
of earnings management practices in the Algerian business environment during the two periods
under study, and secondly, that there is a clear impact of the accounting investigation on earnings
management practices on the study sample.