TY - JOUR AU - Mwangi, John Gikonyo AU - Nasieku, Tabitha PY - 2022/05/11 Y2 - 2024/03/29 TI - Effect of Ownership Structure on Earnings Management in Listed Manufacturing Firms at Nairobi Securities Exchange, Kenya JF - Asian Themes in Social Sciences Research JA - ATSSR VL - 6 IS - 1 SE - Articles DO - 10.33094/atssr.v6i1.66 UR - http://knowledge-press.com/index.php/ATSSR/article/view/66 SP - 12-24 AB - <p>A firm's ownership structure is important to the effectiveness of monitoring the mechanisms used to manipulate earnings. Based on the ownership structure of a firm, management can feel pressure to manage earnings by manipulating the company's accounting practices to meet financial expectations. This paper focuses on how the three components of ownership structure affect earnings management of listed firms. That is to determine the effect of ownership concentration, managerial ownership, and institutional ownership on earnings management of listed firms. As per the jones and modified Jones model, discretionary accruals were used as a measure of earnings management. The study deployed a random effects model and STATA software for data analysis. Data was collected for the period from 2011 to 2019 from all listed manufacturing firms in Nairobi securities exchange. The study findings indicated that managerial ownership, institutional ownership and ownership concentration have an insignificant effect on earnings management. The study indicated that while majority shareholders are keen to closely monitor the management to ensure that their interests are well protected, this can only be attained if they have requisite skills, knowledge, and experience. The study also indicated that most pertinent is to have strong internal controls in place that seals all possible loopholes that could be exploited by the management to manipulate earnings. The study considered two control variables, firm size and growth which were also found to have an insignificant effect on earnings management.</p> ER -