This paper aims to study and investigate the relationship of earnings management detection through changes in the profit margin and asset turnover ratio. It is applied based on the objective and its statistical population includes the investment companies listed on the Stock Exchange during 2007 until the end of financial year 2012. According to the main result of this study, there is a significant inverse relationship between the dependent variable (aggregate accruals) and changes in profit margins. In other words, by increasing the aggregate accruals, the changes in profit margins will decline, and vice versa. The dependent variable (aggregate accruals) has a direct and significant relationship with the changes in the asset turnover ratio. This means that as the result of the increase in the aggregate accruals, the changes in profit margins will raise, and vice versa. Calculations indicate a one unit increase in the amount of profit margin variable reduces the aggregate accruals to -1.09E+10. Furthermore, a one unit increase in the asset turnover variable leads to the enhanced aggregate accruals to 8331.777.
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