FINANCIAL ACCOUNTING
Year:2018 | Volume:10 | Issue:38 |Papers Count:7

Valuation signals have been among the most popular between equity portfolio managers for recognizing overvalue and undervalue stocks. They use wide range of valuation models such as Residual Income Model and Real Option Model which are more complicated and need more data to calculate in comparison with simple models like price to earnings ratio, book yield, and dividend yield. In this research, signaling capability of simple and sophisticated valuation models in Tehran Stock Exchange for the period of 1388-1395 were studied. Efficacy of these models were evaluated from two aspects of quality and strength of signaling by creating different buy and sell portfolios seasonally, mid-yearly, and annually using data of 90 companies. Using measures of excess return, information ratio, profitability, and information coefficient were used, we concluded that sophisticated models had no efficacy in recognizing undervalue and overvalue stocks. Meanwhile, we found that dividend yield is of great interest for investors especially in recognizing overvalue stocks.

In different researches, have been made significant efforts to study and understand the investment behavior of market participants and the impact of these factors on the price of securities, because the behaviors that affect the investment decisions of participants in market have an important role. This study examines the effect of liquidity as a mediator on the relationship between the Stock price synchronicity and herd behavior of shareholders (real and legal). The sample companies in this study belong to the companies admitted in the Tehran Stock Exchange from 2011 to 2016. In this study the Pyotrosky and Roleston models (2004) have been used to measure the price synchronization and the Lakonishok model (1992) for measuring the behavior of the consumers as well as the models of Chai et al (2010) for the liquidity criteria. Findings show that there is a positive and significant relationship between Stock price synchronicity and herd behavior of shareholders (real and legal); Also the results show the mediating role of liquidity criteria in the relationship between Stock price synchronicity and herd behavior of shareholders (real and legal); This effect is partly related to the Stock price synchronicity and herd behavior of legal shareholders and full in the relationship between stock price synchronicity and herd behavior of real shareholders.

The primary motivation is the existing gap in previous literature including taking into account only some of the relevant mechanisms and variables in principal-agent relationship, ignoring correlation and alternative relationship between moderating mechanisms of agency costs and most importantly, neglecting the feedback effects between different variables and mechanisms that lead to unreliable results. Therefore, the authors try to suggest a reliable solution for the above-mentioned deficiencies using a holistic model developed from a systemic thinking. In the current research, firstly, the variables, mechanisms and their present relationships are systematically extracted through the historical recognition method in the form of library studies. Then, using Vensim DSS software, a practical model for optimization of agency costs in the principal-agent relationship is proposed. By the reviewing relevant literature and theoretical backgrounds, 11 important mechanisms that may have a crucial role in diminishing agency conflicts are recognized and utilized in the model. These mechanisms include (1) board of directors (2) independent auditor (3) debt (4) dividends (5) managers' labor market (6) corporate control market (7) product market competition (8) managers compensation (9) financial analysts (10) organizational identity and (11) manager’ s gender. In addition to filling the gap in the current literature, the proposed model in this article indicates that the relationship between variables as well as mechanisms associated with agency costs in the principal-agent relationship are too complicated to address them, using methods such as regression.

The present study attempts to develop a model for auditor independence, according to the grounded theory, in which auditors, owners, and supervisors can identify the identified factors, provide the necessary tools in order to improve the independence of auditors and the quality of audit and the quality of economic decisions. Twenty-two semi-structured interviews were used by experts in the audit profession to collect data from the research. The results of the research show that the quality of human resources, the lack of influence of the client on the auditor, the lack of financial dependence on the client, the quality of the distribution of audits, the rotation of the audit firms, the quality of audit fees, the amount of competitive atmosphere in the audit profession, the observance of professional rules and supervision of the circumstances are the affecting factors on audit independence. Also, the interventionist conditions include the professional competence of the audit firms, the quality of the client's request for audit services, and the level of awareness of the stakeholders from the audit profession and the underlying conditions including legislative, executive and regulatory characteristics, economic characteristics and cultural characteristics in the community and the audit profession.

The main purpose of this paper is to investigate the factors affecting on reduction of the distance between non-audited and audited financial statements. so, the amount of inconsistency between the profit and loss items in non-audited and audited financial statements were used to find out its relevance to some of the characteristics of the company and independent auditors. We use descriptive-study based on the information on between 2011 and 2016. The results indicate that there is a significant difference in operating Income and net income between non-audited and audited financial statements, while the difference between the gross income were not observed. Also, some variables like size, the independence of the board of directors, the ratio of liabilities to assets (the characteristics of the company) and size and the industry specialty (the characteristics of the auditor) has a significant relationship with the percentage of mismatching of operating profit. Meanwhile, there was a significant relationship between the size of the company, the board of directors’ independence, the percentage of institutional investors, the ratio of liabilities to assets and also auditor's industry specialty with the percentage of net profit mismatch.

This study examines the effect of real activities management (RAM) on market pricing and the amount of cash Holdings and the impact that corporate governance quality can have on this relationship. For this purpose, data from 117 companies for the period 1391 to 1394 were used. However, for measuring some variables, the data of these companies for the 4 years before and one year later, over the years 1387 to 1395 were collected and used. The effect of real activities management on the amount and pricing of cash Holdings with a multivariate regression model was investigated. Also, to assess the quality of corporate governance, a model with commonly used indicators was designed and its impact on the pricing of cash Holdings was investigated. Based on the results of the research, income increasing real activities management has a significant effect on the amount and the pricing of cash Holdings. Also, the results indicate that the coefficient related to the interactive effect of cash Holdings and abnormal gains on asset sales in strong corporate governance firms is significantly more than those in weak corporate governance firms. In other words, corporate governance quality makes a meaningful modification of this effect.