Financial Accounting Research
Year:2018 | Volume:10 | Issue:1 (35) |Papers Count:7

Risk taking behavior over firm's life cycle and its relationship with financial performance are examined in this research. Life cycle is one of the most important factors which determines properties of firm's behavior and affect its resource structure, empowerments and abilities. So an adjusted version of ROA with regard to industry effect is used to measure risk taking behavior; the pattern of cash flow in each category including operating, investing and financing and ROA proxy are considered to define life cycle and financial performance respectively. As a consequence, financial data for 150 firms during 2008 to 2015 with some considerations is collected. In order to include dynamic behavior of risk taking, generalized method of moments (GMM) is run to analyze data. The results reveal that firms show riskier behavior in introduction and decline phases in comparison with maturity phase. In addition, firms which are in introductory and decline phases operate much weaker than others from financial aspect.

In recent years, there is a lot of attention to keep the cash in companies in financial literatures. This interest has come up from this reality that companies have reported significant amounts of cash in their balance sheet. Company’s social responsibility is one of the most effective factors in social and financial operation and plays a key role in investors reactions to a company. The main purpose of the present study is to evaluate the social responsibility of companies and their effects on keeping cash through systematic risk index and non-systematic risk and corporate sovereignty. To test the hypothesis, a sample of 91 companies from the accepted ones is Tehran securities exchange was choosen in 2009to 2016. The appropriate method to test the hypothesis is to assess the synchronous equation system through (3SLS) minimum three level has squares. The results show that social responsibility through idiosyncratic risk is a significant and positive impact on cash holdings. As well as social responsibility through systematic risk has a significant negative impact on its cash holdings. The results show social responsibility through corporate governance has positive significant effect on its cash holdings.

Despite increasing the governance mechanisms of earnings management, the managers have incentives to meet investors and analysts' expectations of the earnings. On the other hand, the existence of outsiders that uninformed to methods of expectations management, unlike to methods of earnings management, leads to encourage the manager to reduce the level of the expectations, instead of increasing the level of the earnings. Since the increase in the magnitude and incidence of revisions in the investors and analysts' expectations leads to negative market reaction, it is expected that the existence of finance and accounting expertise on audit committees leads to reduce these revisions. In this paper, it has investigated the association between finance and accounting expertise on audit committees with the expectations management. The sample is consisted of 112 companies listed in the Tehran Stock Exchange for fiscal years 2012 through 2017. The results of testing the hypotheses showed that in the presence of the expert members on the audit committee, did not reduce the likelihood of incidence of the expectations management and incidence of the nonnegative earnings surprises through that but it reduced the magnitude of expectations management.

This research has investigated the effect of deviation from target leverage and financial deficit/surplus on the corporate behavior in leverage adjustment by considering the possibility of changing assets. Recent studies have shown that leverage, regardless of financing policies, tends to mean. This phenomenon which is called mechanical mean-reversion affects the calculated speed of adjustment. This study examines the effect of leverage mean-reversion on leverage adjustment speed. A sample composed of 155 firms listed in Tehran Stock Exchange (TSE) investigated for years 1384 to 1394. Generalized method of moment regression is used to examine the effect of deviation from target leverage and financial deficit/ surplus on speed of adjustment and bootstrap method is applied for determining the effect of leverage mean reversion. Our results show that firms that are at the top of target leverage and face financial deficit are more likely to adjust their capital structure compared to other companies. The results also show that eliminating the effect of mean-reversion of leverage reduce the leverage adjustment speed.

The corporate performance assessment is a matter for current and potential stockholders. Therefore, the present study aims at explicating a model for performance evaluation of investment companies using the data envelopment analysis method, so that by applying PCA, the dependence between input and output variables is eliminated by decomposing to the main factors. The main question in this study is how to evaluate the performance of investment firms? In order to answer this question, all investment companies accepted in the Iranian stock exchange have been selected and the latest available annual reports of investment companies in year 2016, have been analyzed. To design the proposed algorithm, a DEA-PCA compilation approach was used which ultimately led to the design of a performance evaluation model. The results of the proposed algorithm show that out of 34 investment companies under review in 2016, only 4 companies with a performance score of one, are considered as efficient. In other words, 12% of investment companies are efficient and 88% are inefficient, which, of course, efficient companies are patternmakers for other companies.

The purpose of this study is to examine the impact of the audit committee on the stock prices crash risk by Looking at the ethical voluntary disclosure. To assess the impact of the quality of the audit committee on the ethical voluntary disclosure, the proposed variable variables related to the issue and to examine the stock prices crash risk, were used from four factors of negative skewness of stock returns, maximum sigma, fluctuations to the bottom and the fall of stock prices. This is an applied research and uses post-event approach. The studied period is 2013-2017 and the sample is a sample of 76 companies. The least squares regression method was used to test the hypotheses. The findings of this study showed that, after eliminating the effect of control variables, the variables affecting the quality of the audit committee in ethical voluntary of ethics have a significant effect on the stock prices crash risk.