This study investigates the association between CEOs' over-confidence in experiencing financial distress or soundness, future earnings management, and over and under-investment decisions. It examines how financial distress (soundness) influences the relationship between earnings management and over (under)-investment decisions, addressing a literature gap concerning intentional earnings management for future investment decisions in developing countries. The study uses prospect theory, framing, conservatism, and psychological projection to explain CEOs' future investment decisions, considering the influence of financial distress or soundness on this association in an international setting.

Sumiyana Sumiyana, Ainun Na'im, Firdaus Kurniawan, Albertus H. L. Nugroho