The value relevance of accounting information on amman stock exchange: the moderating role of audit quality

The study aimed to measure the value relevance of return on assets (ROA), return on equity (ROE), earnings per share (EPS), and operating cash flow (OCF) on the share prices of listed firms on the Amman Stock Exchange (ASE) from 2018 to 2022. The research is based on the Ohlson model (1995), derived from valuation theory. The results revealed that all independent variables were positively correlated with share prices. Conversely, the moderating effect of audit firm size negatively impacted the variables. The findings indicated that the value relevance of earnings and operating cash flow had a more significant effect on share prices within the context of the ASE. This indicates that investors prefer short-term investment strategies that prioritise quick investment returns. This study contributes significantly to the limited body of research addressing the value and relevance of accounting information within the Jordanian context. Shedding light on this topic offers valuable insights to decision-makers in both firms and the investor community. Specifically, it underscores the importance of considering the effective utilisation of accounting ratios in informing strategic decisions and investment choices.