The Effect of Global Financial Crisis on Earnings Quality

In the global financial crisis, managers are under pressure, and to avoid bankruptcy, they manipulate financial information or hide them to postpone financial distress, using their authorities in applying accounting standards and doing estimates and forecasts. This study investigates one of the most...

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Main Authors:	Mohammad Hossein Safarzadeh (Ph.D), Reza Vahedian
Format:	article
Language:	FA
Published:	Shahid Bahonar University of Kerman 2018
Subjects:	global financial crisis earnings quality accounting conservatism accruals quality earnings smoothing Accounting. Bookkeeping HF5601-5689
Online Access:	https://doaj.org/article/42279e4593f24a28bf3f0640c543878f
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spelling	oai:doaj.org-article:42279e4593f24a28bf3f0640c543878f2021-11-04T19:53:27ZThe Effect of Global Financial Crisis on Earnings Quality2008-89142476-292X10.22103/jak.2017.10347.2403https://doaj.org/article/42279e4593f24a28bf3f0640c543878f2018-01-01T00:00:00Zhttps://jak.uk.ac.ir/article_1860_377c7dc641c2ff8e319b2da4fd14d6d5.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XIn the global financial crisis, managers are under pressure, and to avoid bankruptcy, they manipulate financial information or hide them to postpone financial distress, using their authorities in applying accounting standards and doing estimates and forecasts. This study investigates one of the most important factors affecting earnings quality, using seven criteria to measure earnings quality, including ex-post and ex-ante conservatism, value relevance, accruals quality, earnings persistence and earnings smoothing, as well as a zero-one dummy variable to introduce the absence or presence of global financial crisis, totally in the multivariate regression and panel data models. This study used data collected from a sample of 148 firms in the Tehran Stock Exchange in the years 2005 to 2015. Findings showed that the global financial crisis improves quality of earnings through positive impacts on some criteria of earnings quality, including earnings persistence and smoothing, and reduces quality of earnings through negative impacts on some other criteria, including conservatism, value relevance, accruals quality and earnings predictability. The findings also indicated that quality of earnings before the period of global financial crisis is more than that during the crisis.Mohammad Hossein Safarzadeh (Ph.D)Reza VahedianShahid Bahonar University of Kermanarticleglobal financial crisisearnings qualityaccounting conservatismaccruals qualityearnings smoothingAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 8, Iss 4, Pp 37-64 (2018)
institution	DOAJ
collection	DOAJ
language	FA
topic	global financial crisis earnings quality accounting conservatism accruals quality earnings smoothing Accounting. Bookkeeping HF5601-5689
spellingShingle	global financial crisis earnings quality accounting conservatism accruals quality earnings smoothing Accounting. Bookkeeping HF5601-5689 Mohammad Hossein Safarzadeh (Ph.D) Reza Vahedian The Effect of Global Financial Crisis on Earnings Quality
description	In the global financial crisis, managers are under pressure, and to avoid bankruptcy, they manipulate financial information or hide them to postpone financial distress, using their authorities in applying accounting standards and doing estimates and forecasts. This study investigates one of the most important factors affecting earnings quality, using seven criteria to measure earnings quality, including ex-post and ex-ante conservatism, value relevance, accruals quality, earnings persistence and earnings smoothing, as well as a zero-one dummy variable to introduce the absence or presence of global financial crisis, totally in the multivariate regression and panel data models. This study used data collected from a sample of 148 firms in the Tehran Stock Exchange in the years 2005 to 2015. Findings showed that the global financial crisis improves quality of earnings through positive impacts on some criteria of earnings quality, including earnings persistence and smoothing, and reduces quality of earnings through negative impacts on some other criteria, including conservatism, value relevance, accruals quality and earnings predictability. The findings also indicated that quality of earnings before the period of global financial crisis is more than that during the crisis.
format	article
author	Mohammad Hossein Safarzadeh (Ph.D) Reza Vahedian
author_facet	Mohammad Hossein Safarzadeh (Ph.D) Reza Vahedian
author_sort	Mohammad Hossein Safarzadeh (Ph.D)
title	The Effect of Global Financial Crisis on Earnings Quality
title_short	The Effect of Global Financial Crisis on Earnings Quality
title_full	The Effect of Global Financial Crisis on Earnings Quality
title_fullStr	The Effect of Global Financial Crisis on Earnings Quality
title_full_unstemmed	The Effect of Global Financial Crisis on Earnings Quality
title_sort	effect of global financial crisis on earnings quality
publisher	Shahid Bahonar University of Kerman
publishDate	2018
url	https://doaj.org/article/42279e4593f24a28bf3f0640c543878f
work_keys_str_mv	AT mohammadhosseinsafarzadehphd theeffectofglobalfinancialcrisisonearningsquality AT rezavahedian theeffectofglobalfinancialcrisisonearningsquality AT mohammadhosseinsafarzadehphd effectofglobalfinancialcrisisonearningsquality AT rezavahedian effectofglobalfinancialcrisisonearningsquality
_version_	1718444586493280256

The Effect of Global Financial Crisis on Earnings Quality

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