Open AccessValue Relevance (VR), Earnings Management and Corporate Governance System
Author(s) -
Reza Dowlatabadi,
Mahdi Filsaraei
Publication year - 2016
Publication title -
international journal of accounting and financial reporting
Language(s) - English
Resource type - Journals
ISSN - 2162-3082
DOI - 10.5296/ijafr.v6i2.10410
Subject(s) - earnings management , business , corporate governance , stock exchange , accounting , shareholder , earnings response coefficient , audit committee , audit , earnings , earnings per share , finance
Today, to make investment decisions, investors analyze the stock in the stock market and an information source used by them isthe financial report of the related firms. In some cases, the report may be prepared in accordance with management policies, which is known as an earnings management.Earnings management will affect intelligence value and consequently have negative impact. Due to these issues, in this study, the relationship between VRof earnings, earnings management and corporate governance is discussed. Using a sample of listed companies in Tehran Stock Exchange and the regression model, the results showed that the ownership of institutional investors has reduced the earnings management, but compared to major shareholders and company's audit by the National Audit Office, it has increased earnings management.The results also show that there is no significant relationship between management and the stock price as an indicator of measuring the VR of earnings.