Managers' narcissism, earning quality, and bankruptcy risk

A test of behavioral psychology theory

Authors

  • Fereydoun Ohadi Assistant Professor, Department of Industrial Engineering, Karaj Branch, Islamic Azad University, Karaj, Iran.
  • Department of Accounting, Islamic Azad University, Science and Research Branch, Faculty of Economics and Management, Tehran,Iran. Department of Accounting, Islamic Azad University, Science and Research Branch, Faculty of Economics and Management, Tehran,Iran.
  • Hashem Nikoomaram Associate Professor, Department of Finance and Accounting, Department of Accounting, Faculty of Economics and Management, Islamic Azad University, Science and Research Branch, Tehran, Iran.
  • Ramezanali Royaye Assistant Professor, Department of Finance and Accounting, Department of Accounting, Faculty of Economics and Management, Islamic Azad University, Tehran, Iran.

DOI:

https://doi.org/10.22478/ufpb.2238-104X.2022v12n2.63076

Abstract

Purpose: This study was conducted with the aim of investigating the effect of narcissism in managers on profit quality and bankruptcy risk. Design/methodology/approach: The present study is applied in terms of purpose and is in positive accounting research. The research data were also collected based on information from sample companies selected by the systematic elimination sampling method. Based on this, 177 companies were selected over ten years, from 2012 to 2021. The research data were extracted annually from Rahavard Novin 3 software. After performing calculations in EXCEL software to enter the relations and hypotheses of the research, they were entered into Eviews software .Findings: The results of the research hypotheses test showed that managers' narcissism significantly affects earnings stability, earnings predictability, earnings relevance, earnings timeliness, and bankruptcy risk. We also found that narcissistic managers could have two positive and negative dimensions and the presence of these managers in the organization increases the quality of earnings but also the risk of bankruptcy.Academic contributions: There is a contribution to the development of knowledge related to the effect of managers' narcissism on the profitability and bankruptcy of organizations. Practical contributions: The presence of narcissistic managers in the organization can have two positive and negative dimensions, and narcissistic characteristics may neutralize their creative talent for the organization.

Downloads

Download data is not yet available.

Downloads

Published

2022-09-12

How to Cite

Ohadi, F., Faghekarimi, S. ., Nikoomaram, H. ., & Royaye, R. . (2022). Managers’ narcissism, earning quality, and bankruptcy risk: A test of behavioral psychology theory. Theory and Practice in Administration - TPA, 12(2). https://doi.org/10.22478/ufpb.2238-104X.2022v12n2.63076

Issue

Vol. 12 No. 2 (2022): Jul/Dez - Fluxo contínuo

Section

Artigos de Pesquisa (Research Papers)

License

Autores mantêm, irrestritamente, o copyright e os direitos autorais, e concedem à revista Teoria e Prática em Administração (TPA) o direito à primeira publicação, com o trabalho simultaneamente licenciado sob a Licença Creative Commons Attribution CC BY que permite o compartilhamento da obra com o reconhecimento da autoria e publicação inicial nesta revista.