The Effect of Accounting Conservatism on Share Repurchases: an Applied Study on Firms Listed on the Egyptian Stock Exchange.

The purpose of this paper is to examine the effect of accounting conservatism on share repurchases for firms listed on the Egyptian stock exchange. The research hypothesis was derived, which is represented in: There is a negative relationship between the accounting conservatism and share repurchases. Multiple regression and logistic regression were used to test the research hypothesis. The sample used in the current study consists of 24 firms listed on the Egyptian stock exchange for the period from 2000 through 2019. To the best of the researcher knowledge, there are no Egyptian studies to date that examined the effect of accounting conservatism on share repurchases. Consequently, this paper contributes to the limited literature by suggesting a new model for the effect of of accounting conservatism on share repurchases. The researcher concludes that the new model is useful in explaining the effect of accounting conservatism on share repurchases. The study finds that (a) accounting conservatism has a significant negative effect on share repurchases, (b) Free cash flow has a significant positive effect on share repurchases, (c) Firm size has a significant positive effect on share repurchases, (d) Firm leverage ratio has a significant negative effect on share repurchases.