Financial Accounting Research
Year:2014 | Volume:6 | Issue:4 (22)|Papers Count:8

The aim of this article is to investigate stability magnitude of earnings’ cash component rather than its accrual component, and the effect of firm’s characteristics on accruals items anomaly in metal and metal mineral industries listed Tehran Stock Exchange. Financial data of 49 listed companies in Tehran Stock Exchange during 2001-2011 are collected. For data analysis multivariate regression method in Mish-Kin test is used. Findings indicate that stability of earnings cash component is more than its accrual component, and cash component has more power in forecasting market value. Other obtained result is the existence of accruals items anomalies in metal and metal mineral industries. However, these anomalies are omitted with entrance of control variables (Firm Characteristics).

The main objective of this study is to investigate relationship between ownership concentration and tax aggressiveness for companies listed in Tehran Stock Exchange (TSE) from 2002 to 2011. The research question is whether the type of largest shareholder ownership (public or private), affects tax aggressiveness or not. In this study largest shareholder ownership is used as concentration ownership measurement and effective tax rate as tax aggressiveness measurement. Lower the effective tax rate it means that firm is tax aggressive. Results of study indicate that when ownership concentration is higher, the firm is less tax aggressive. Probably this is due to the high concentration of state ownership. Social and political theory is confirmed.

One of the equity market anomalies is accrual anomaly. This anomaly observes the negative relationship between accruals and future stock returns. In this regard, there are two points of view, behavioral and rational expectations. Analyzing book-to-market decomposition, this study investigates these two views in one framework, examining which of the two is more related to accrual anomaly. Based on theoretical and research background, Book-to-Market (B/M) ratio is decomposed into Book-to-Intrinsic value (B/V) ratio and Intrinsic-to-Market value (V/M) ratio. B/V component shows the discount rate changes and firms’ investment related to growth (risk and growth) and of course it is based on the rational expectations view and V/M component states the investor’s mispricing and based on the behavioral view. The results of investigating 80 firms from companies listed in Tehran Stock Exchange from 2002 to 2009 offers that B/V and V/M have a negative and significant impact on accrual. Furthermore, there is accrual anomaly in the Tehran Stock Exchange somehow, relating to B/V. As a result, risk and growth are main cause of anomaly accrual.

Cash is the important resources of every economic entity. Maintaining the balance between cash and cash needs is an important factor in economic health of the economic entities, as well as their continuity. Considering the importance of this issue, the present study deals with investigating of the cash holding motives, models that justify cash holding, and factors affecting that, particularly the market share. The main objective of this study is to evaluate the relationship between market share and cash holding in the competitive market environment of companies listed in Tehran Stock Exchange. Hence, Schoubben and Van Hulle dynamic cash model has been used for 114 selected companies for a time period of 2004 to 2012. This model is analyzed by the Generalized Method of Moments (GMM). This study is a basic experimental research and regarding the nature of this paper, it is a correlational one. Results of this study reveal that there is a significant negative relationship between market share and cash holdings and also shows that this relationship is of greater significance among moderately concentrated industries (industries with oligopolistic competitions).

The theoretical literature is inconclusive on whether competition is beneficial or harmful to firms. Some studies show that competition disciplines managerial behavior by providing additional information for performance evaluation. In contrast, another stream of research shows that competition increases managerial slack. This study investigates whether and how a firm’s real earnings management via real transaction structuring activities (REM) is influenced by the extent of product market competition. Thus, the major purpose of this paper is investigating and analyzing the relationship between proxies of real earnings management and product market competition. This study is descriptive-correlation based on panel data analyzing. The 99 firms existing in Tehran Stock Exchange has been selected as sample for time period 2007-2011. To examine the relationship between product market competition and earnings management through real activities, multiple regression models are used. Also Tobin Q index is used for measuring the product market competition. The results show that there is a significant positive relationship between proxies of real earnings management and product market competition. This indicates increase in earnings management by increasing product market competition, which also leads to decrease in the quality of earnings.

The main objective of this research is to investigate the relationship between membership in business groups and stock return in companies listed in Tehran Stock Exchange. Our sample based on cumulative data includes 1394 firms - year observations that are related to 144 companies listed in Tehran Stock Exchange during the period of 2001-2011. We use multivariate linear regression model to test the research hypotheses. Our findings indicate that stock return rate in business group companies is higher than those of independent companies. Also, stock return rate in firms affiliated with large and diversified business groups is higher than other business groups. Our findings of this research indicate that with increasing the levels of information asymmetry, decreases companies stock return rate. Also, with increasing level external financial dependence, companies stock return rate is higher. Also, findings indicate that stock return rate of business groups affiliated companies compared with independent companies and stock return rate of companies affiliated with large and diversified business groups compared with other groups are less sensitive to information asymmetry. Also, findings indicate that stock return rate of business groups affiliated companies compared with independent companies and stock return rate of companies affiliated with large and diversified business groups compared with other groups did not show sensitivity to external financial dependence. In addition, results indicate that in the Tehran Stock Exchange, there is no significant relationship between stock returns and corporate life cycle.

The recent studies demonstrate that the costs have asymmetrical behavior which means the rate of reduction in costs while reducing the sales is less than the rate of increase in costs while increasing the sales at the same rate. This Asymmetrical behavior is called cost stickiness. One of the reasons that can exert an influence over cost stickiness is personal motives of managers that stem from the agency problem. Furthermore, the mechanisms of corporate governance result in inhibition of managers’ motives and result in decrease in the cost stickiness. Therefore in this study, the influence of managers’ empire building incentives and the variables of corporate governance on cost stickiness has been carried out. In this paper, the number of 142 firms were selected in the period of the years 2004 to 2013 as a statistical sample. The results suggest a significant impact of free cash flows on the costs stickiness. Hence, the asymmetry of costs have positively related with personal motivations and empire building of managers. Also, The findings of this study indicate that strong corporate governance mitigates the significant impact of free cash flow on the costs stickiness. This result suggest that corporate governance mechanisms play an important role in restrain managers’ incentives.