The Impact of Implementing IFRS 15 on Earnings Quality-Evidence from Palestinian-Listed Corporations

The study examines the effect of adopting IFRS 15 (Revenue from Contracts with Customers) on the earnings quality of the Palestine Exchange (PEX) listed firms. Data for the study was collected using the financial statements of fifteen companies covering eight years (2014-2021). The study employs the Modified Jones Model—discretionary accruals to measure the earnings quality. The multiple regression results suggest that adopting IFRS 15 leads to lower earnings quality due to a significant positive relationship between implementing IFRS 15 and discretionary accruals. This study contributes to the literature on earnings quality. It is considered the first to investigate the impact of IFRS 15 on earnings quality using an analytical approach, particularly in Palestine and generally in developing countries.