Title: The nexus of ERP system adoption and discretionary accruals: the moderator effect of Big 4 audit firms

Authors: Ahmad A. Toumeh

Addresses: Faculty of Business, Al-Zaytoonah University of Jordan, P.O. Box 130 Amman 11733, Jordan

Abstract: This study investigates the impact of enterprise resource planning (ERP) adoption and Big 4 audit firms on accrual-based earnings management (AEM) in the non-financial companies listed on the Amman Stock Exchange (ASE), as well as the moderating effect of Big 4 auditors on the nexus between ERP implementation and AEM. Panel data analysis was utilised in this research, and the random-effects GLS regression was employed to derive conclusions. The sample of this study is represented in service and manufacturing firms listed on the ASE, with 432 firm-year observations during the period 2015-2020. The results demonstrate that ERP non-adopting companies are more apt to participate in earnings management (EM) than ERP adopting companies. The current study should advance EM literature in the Jordanian context. Also, this is the initial empirical attempt worldwide to examine the indirect effect (moderation) of audit quality (AQ) on the association between ERP implementation and EM.

Keywords: discretionary accruals; earnings management; enterprise resource planning; ERP; audit quality; Big 4 audit firms; accrual-based earnings management; AEM; Jordan.

DOI: 10.1504/IJBIS.2025.150751

International Journal of Business Information Systems, 2025 Vol.50 No.4, pp.480 - 498

Received: 15 Feb 2022
Accepted: 05 Mar 2022
Published online: 23 Dec 2025 *

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