FACTORS AFFECTING FINANCIAL REPORTING QUALITY IN AGRICULTURAL COMPANIES IN THE REPUBLIC OF SERBIA

Milica Djordjevic; Bojana  Novićević Čečević; Marjan  Mirčevski

doi:10.59267/ekoPolj24031033D

Authors

Milica Djordjevic Faculty of Economics Nis, Niš, Serbia https://orcid.org/0000-0003-1652-4186
Bojana Novićević Čečević Faculty of Economics Nis, Niš, Serbia https://orcid.org/0000-0002-4269-0586
Marjan Mirčevski Military academy, Belgrade, Serbia https://orcid.org/0009-0004-4285-6066

DOI:

https://doi.org/10.59267/ekoPolj24031033D

Keywords:

Earnings management, discretionary accruals, manipulations, firm’ characteristics, audit

Abstract

The research objective is to establish the factors that influence financial reporting quality (FRQ) in agricultural companies in the Republic of Serbia. Based on a sample of 99 large and medium-sized companies in this sector (86.09% of the total population), and following the analysis of 2018-2022 financial statements and auditor’s reports, we examine the conditionality of earnings management (EM) as a FRQ determinant at enterprise level. In order to achieve the defined objective, we apply statistical methods, i.e. correlation and multiple linear regression. The research results indicate that more profitable companies have better FRQ, i.e., a higher return on assets, then companies whose financial statements are audited by Big 4 audit firms and companies with low debts. Also, the research results indicate that FRQ of the sampled companies is not affected by their liquidity, board size and audit tenure.

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