Istanbul Business Research, cilt.49, sa.2, ss.303-317, 2020 (ESCI)
R&D expenditures are important in increasing the level of information and technological development. Efficiency in
production, cost reduction and competitive advantage are achieved with the added value created by successful R&D
activities. However, in the process of accounting and reporting the R&D expenditures, some manipulative applications
can be implemented by the business management for achieving personal or corporate targets. The purpose of this
research is to reveal the effect of R&D expenditures on earnings management. In this context, from 2007 to 2018, 65
companies that made R&D expenditures included in BIST-All Shares Index were examined. The earnings management
effect calculated on the Modified Jones Model, taking into account the current period, one-year and two-year time
lag of R&D expenditures was tested with panel data analysis. As a result of the research, it was determined that R&D
expenditures negatively affect earnings management in the current period and positively in lagged periods. In addition,
while size and leverage have negative effects on earnings management in the current period, one-year and two-year time
lag, no statistically significant relationship was found in terms of return on assets.