Earnings Manipulation Risk and Profitability in Restaurant Companies: An Analysis in Borsa Istanbul

Authors : Erdinç Karadeniz, Ömer İskenderoğlu

Pages : 1-23

View : 52 | Download : 280

Publication Date : 2025-12-26

Article Type : Research Paper

Abstract :This study has two primary objectives. The first is to measure earnings manipulation risk among restaurant companies listed in the Hotels and Restaurants sector on Borsa Istanbul. The second is to examine the relationship between manipulation risk and profitability performance. Earnings manipulation risk for the 2021–2024 period was assessed using the Montier C-Score model. Return on assets (ROA), return on equity (ROE), and return on sales (ROS) were then calculated, and their association with manipulation risk was evaluated through correlation analysis and ranking. The results indicate that restaurant companies exhibited varying C-Scores across years, with an overall moderate level of earnings manipulation risk. Criterion 6 (Asset Growth) emerged as the most frequently triggered indicator of potential manipulation, while Criterion 1 (Difference between Net Income and Cash Flow from Operating Activities) reflected the lowest risk. Notably, a consistent positive relationship was found only between earnings manipulation risk and return on sales, suggesting that higher manipulation risk may be associated with increased return on sales.
Keywords : Kazanç Manipülasyonu, Montier C-Skoru, Karlılık, Restoran İşletmeleri, Borsa İstanbul

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