Journal of Empirical Research in Accounting
Year:2018 | Volume:7 | Issue:27 |Papers Count:10

This study with the aim to determine factors influencing the investment opportunities, investigates  the effects of financial leverage on the relation between accounting conservatism and  investment opportunities in firms listed in Tehran Stock Exchange from 2007 to 2013. The results show a significant positive effect of accounting conservatism on financial leverage as well as a significant negative effect of financial leverage on investment opportunities. To examine the mediating effect of financial leverage on the relation between accounting conservatism and investment opportunities, the multiple regression method (Baron and Kenny) is used. The results show a significant partial mediating effect of financial leverage on the relationship between accounting conservatism and investment opportunities of firms listed in Tehran Stock Exchange. In other words, about 24% of the effect of accounting conservatism on investment opportunities is due to the financial leverage (indirect effect) and about 76% through its effect (direct effect).

The effects of promotion of managerial ability on a company's performance have been considered in the financial and accounting literature. A company's longer life and its more different stages of the life cycle pave the way for managers to promote the effectiveness of their special abilities to improve operational activities of companies. This study examines the effect of managerial ability on company's performance in the growth, maturity and decline periods of some firms listed in TSE in the years from 2006 to 2014. For this purpose, the relation between managerial ability and company's performance is examined as the first hypothesis. The first hypothesis test results demonstrate a positive effect of managerial ability promotion on improvement of a company performance in form of return on investment. In addition, the second hypothesis test shows that the significant positive correlation between managerial ability and company performance is observed only in the growth and maturity periods and there is no significant relationship for firms in decline stage.

This research is aimed to analyze the managerial behavior in earnings report, so it investigates the relation of investment inefficiency and financial constraints to earnings management. Earnings management is measured based on Kothari et al (2005) model and investment inefficiency is measured based on the Fazzari et al (1988), Kaplan & Zingales (1997) and Linck et al (2013) models. Financial constraints is measured based on some criteria like net financial leverage, free cash flow, interest rate, dividend payout, operational cash flow, size and age of firms. The sample consists of 260 firms listed in Tehran Stock Exchange over the period from 2009 to 2015. Hypotheses are tested based on panel multivariate regression model. The results show a significant and positive relation between investment inefficiency and earnings management; while there is no significant relation between financial constraints and earnings management.

This research is aimed to investigate and compare the effects of different feature selection methods on auditors' opinion type prediction. To do so, this research compares the performance of feature selection methods (including correlation-based, t-test, stepwise discriminate analysis, relief and factor analysis). Two classifiers used in this study are support vector machine and neural networks. The sample includes 1214 firms-years listed in the Tehran Stock Exchange in the period from 2008 to 2015. The results confirm the effectiveness of feature selection methods and significant differences among their performance. In other wordsc, using the feature selection methods increases the mean of accuracy and reduces type I and type II errors. Furthermore, the results indicate that support vector machine outperforms the neural networks.

This study examines the relation of conditional and non-conditional persistence of earning components to abnormal returns. The conditional persistence has been calculated using the concept of investors’ over-reaction towards accruals and their under-reaction towards sales revenue. The research uses multivariate regression method and the statistical sample consists of 66 firms listed in the Tehran Stock Exchange over the period from 2003 to 2016. To test the hypotheses, the panel data method and t-student test is used. The findings show a significant relation of the “the difference of conditional and non-conditional persistence of unexpected revenues” and “unexpected revenues” to “abnormal stock returns”; however, the findings indicate no relation of “differences of conditional and non-conditional persistence of unexpected revenues” and “unexpected earnings” to “abnormal stock returns”. Also, the relation between “the difference of conditional and non-conditional persistence of accruals" and "accrual anomaly" is not confirmed.

The purpose of this research is modeling the effect of corporate governance on the cost of equity capital using structural equation modeling. This study is a quantitative, causal, correlational and applied research. The sample consists of 61 firms listed in Tehran Stock Exchange during 2005-2014, elected through the systematic omission method. Partial Least Square (PLS) method and Smart PLS2 software are used for data analyzing. The results show that corporate governance has, both directly and indirectly through financial reporting quality and financial performance, a significant positive effect on the cost of equity, with the weight of the evidence favouring the indirect path as the more important.

According to the agency theory, due to interest conflict between firm managers and investors, auditing report affects financial statements validity and may increase or decrease information asymmetry in capital market. Internal control weakness report is one of the reports whose reliability may be affected by audit report and may moderate information asymmetry in the capital market. So, this study is aimed to investigate the relation between disclosure report of internal controls weakness and information asymmetry and moderating effect of audit report on this relation in firms listed in TSE. To do this, the 3 years (2012 to 2014) data about internal controls weaknesses of firms listed in Tehran Stock Exchange is analyzed by panel data analysis method. The results show that there is a significant relation between disclosure of internal controls weakness and information asymmetry and also, audit report has a moderating effect on this relation. These results confirm the important role of auditing in validation of financial statements and reduction of information asymmetry.

This study examines the value relevance in the Tehran Stock Exchange and compares the value relevance of accounting measures during the essential volatility in Tehran Stock Exchange. The statistical sample includes all firms listed in Tehran Stock Exchange with the exception of banks, investment firms, insurance firms and leasing firms. The systematic omission method is used for sampling. This study uses the panel data regression method, model ohlson (1995) during the years 2005 to 2015 and Eviews and Stata software. The findings show that during an increasing essential volatility as well as a decreasing essential volatility, the value relevance of book value and operating cash flow is less than the value relevance of net income. However, during a non-essential volatility, the value relevance of book value and operating cash flow doesn’t have any significant difference with the value relevance of net income. This research, as an innovation, examines the value relevance of accounting information during the essential volatility in Tehran Stock Exchange.

The aim of this paper is to examine the effect of corporate governance on the relation between investor sentiment and corporate investment decisions. For this purpose, a sample of 106 firms listed in Tehran Stock Exchange during 2009 to 2014 is examined. This study uses Corporate Governance Index derived from a check list which contains twenty-one questions. To analyze data and test hypotheses, the multivariate regression model based on panel data is used. Findings show that investor sentiment has a significant effect on new investments and overinvestment level. Also, Corporate Governance Index has a significant impact on the relation of investor sentiment to new investment and overinvestment. In other words, in firms with a higher level of corporate governance, investor sentiment effect on corporate investment decisions is improved.

Appropriate corporate governance mechanisms are essential factors for efficient use of resources, improvement of accountability and transparency, and observation of fairness and the rights of all stakeholders of firms. This study investigates the relation of corporate governance index to capital cost and systematic risk. The sample consists of 235 firms listed in Tehran Stock Exchange in 2014. This study uses regression analysis method to test the hypotheses and applies 4 corporate governance criteria to measure corporate governance index primarily calculated by SEO in 2014. The results show a significant negative relation between capital cost and corporate governance index and a significant positive relation between systemic risk and corporate governance index. Therefore, effective and strong corporate governance reduces information asymmetry and ensures accurate reporting, increases transparency and stakeholders' confidence and consequently reduces cost of capital. Also, shareholder-oriented corporate governance mechanisms have more systematic risk, thus good corporate governance may lead to higher risk instead of preventing it.