THE IRANIAN ACCOUNTING AND AUDITING REVIEW
Year:2004 | Volume:11 | Issue:36|Papers Count:8

Nowadays, investors take a broad rang of features into consideration. However, there has been little investigation on the methods of choosing different options between investors. Investors" decision-making grow more complicated and get more risky day by day and the results of these decisionmakings can have an important affect on the people"s lives, especially when retiring. We have little information about the effective factors on investors" decision-making. The following research will use an analytical approach in order to investigate these factors on investors" decision-makingwhen buying shares. The same approach has been used in investigating choices of nonfinancial products which are effective on decision-making. The results illustrate that investors are less enthusiastic in risky transactions and speculation. Furthermore, financial.priorities are much related to each other in decisions for buying shares. However their importance is less than price fluctuations and also the trend of share prices in stock markets.

Investors generally invest in tangible and financial assets. Investment in financial assets takes place by buying shares and debenture ect. When a person buys a company"s share he will be the owner of that company and will enjoy from some benefits such as dividends, rights issue, stock dividends, bonus and increase of share"s prices. At the end of each financial Period, companise will have to make two crucial decisions: What Portion of income has to be distributed to the share holders, and what portion of it needs to be invested in the company? Therefore the important question here is: what is the relation between earnings per share, dividends and investment? In order to answer these questions seven hypotheses have been raised and these hypotheses have led to the design of various models in order to decide a relation between earning per share, dividends and investment. By using regession model and related softwares, comprehensive data of companies have been gathered and analyzed during the years 1991-2001. The results proved a relation between earnings per share, dividends and investment.

This study examines choices of accounting accruals (Manipulating in earnings) using a sample of Iranian companies, which operate in a rather different environment from other countries. The"results illustrate that on the average there has not been a positive relation between debt to equity ratio and income manipulation. In addition, the relationship between the number of employees and political or economic pressure had also been investigated. The" results suggested that in comparison with small companies, large companies with more employees could be subject to more political pressure. However, the negative relationship between the number of employees might be attributable to firm attempts to understate their income (economic rather than political motivation). Furthermore, bonus variable and ownership variable have notbeen related significantly in Iranian companies.

This research investigates two important issues using Agency Theory: First, the relationship between the bonuses of executive directors of Iranian companies and accounting income, profit growth, and market added value will be examined. Secondly, the important indices in the setting of director"s bonus will be studied. For our first part of research, the data and information has been gathered from income Producing companies which have been listed in Teharan"s stock exchange between the years of 1997 and 2001. For the second part of our research, some questionnaires have been used asking the viewpoints of executive directors and advisors. The results of each part have then been submitted using statistical methods.

Predictingthe ability of earnings in.many financial situations is a crucial matter. consequently, many financial and accounting researches are designed to uncover financial variables and indices that have had significant relationship with earnings. Studies of Ball, Ross &Watts (1979), Freeman, Ohlson & Penman (1982) and other similar studies are done in this regard. The main important purpose of this study is to find the relation between value added data (including Economic Value Added and Cash Value Added) with earnings. In this regard, the relationship between changes in earnings and changes in economic value added and cash value added, for manufacturing companies of Tehran Stock Exchange (TSE), was examined during the period of 1996 to 2002. Regression method and OLS technique Were used in order to test the hypotheses of this research. The results illustrate that there is a significant relationship between earnings changes and Economic Value Added" changes in all studied companies, regardless of the type of their industries. However, this relationship has been proved in all industries, except for equipment and automobile manufacturings In other hands, the results show that relationship between earnings" changes and cash Value Added" changes is not significant in all of studied companies, regardless of their industry type and their related industries.

Real options are important factors in investment decision-making process which simple discounted cash flow techniques (DCF) ignore them. In the absence of explicit real option models in practice it is interesting to see how financial managers take into account real option values. Anecdotal evidence suggests that investment decision-makers may use hurdle rates far in excess of their cost of capital to account for the real option values. The findings confirm the real option awareness and the use of real options in an ad hoc heuristic way by financial mangers in the large UK firms.