Explaining the Relationship between Corporate Governance and Earnings Quality in Iran

Using panel data analysis, this paper examines the relationship between corporate governance and quality of reported earnings. The sample is comprised of 117 listed in Tehran Stock Exchange (TSE) during the period of 1386-1388. Prior research has used many surrogates for corporate governance. Howeve...

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Autores principales:	Kaveh Mehrani, Mohammad Hosein Safarzadeh
Formato:	article
Lenguaje:	FA
Publicado:	Shahid Bahonar University of Kerman 2011
Materias:	earnings quality corporate governance measure monitoring hypothesis assurance hypothesis Accounting. Bookkeeping HF5601-5689
Acceso en línea:	https://doaj.org/article/7ba54a9414c4426890f840c2db3940cf
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spelling	oai:doaj.org-article:7ba54a9414c4426890f840c2db3940cf2021-11-04T19:41:46ZExplaining the Relationship between Corporate Governance and Earnings Quality in Iran2008-89142476-292X10.22103/jak.2011.13https://doaj.org/article/7ba54a9414c4426890f840c2db3940cf2011-12-01T00:00:00Zhttps://jak.uk.ac.ir/article_13_ca6eed7eeb4afa1c92e2c252e651cf70.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XUsing panel data analysis, this paper examines the relationship between corporate governance and quality of reported earnings. The sample is comprised of 117 listed in Tehran Stock Exchange (TSE) during the period of 1386-1388. Prior research has used many surrogates for corporate governance. However, the criticism of the extant research has been that corporate governance comprises many facets and is not uni-dimensional. Quality of earnings is measured in seven ways. Empirical tests demonstrate that the overall governance measure is 1) negatively related to the accrual quality, earnings persistence, earnings management and conservatism, 2) positively related to the earnings predictability and earnings timeliness, and 3) not related to the value relevance. In other words, the results suggest that there are multiple dimensions to the relationship between earnings quality and corporate governance that preclude supporting the spirit of either the monitoring or the assurance hypotheses. Furthermore, our results suggest that disaggregating corporate governance measure into more components cause to decreasing in explanatory power of the models. Finally, the relationship between corporate governance and various measures of earnings quality in different industries is not homogenous.Kaveh MehraniMohammad Hosein SafarzadehShahid Bahonar University of Kermanarticleearnings qualitycorporate governancemeasuremonitoring hypothesisassurance hypothesisAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 2, Iss 7, Pp 69-98 (2011)
institution	DOAJ
collection	DOAJ
language	FA
topic	earnings quality corporate governance measure monitoring hypothesis assurance hypothesis Accounting. Bookkeeping HF5601-5689
spellingShingle	earnings quality corporate governance measure monitoring hypothesis assurance hypothesis Accounting. Bookkeeping HF5601-5689 Kaveh Mehrani Mohammad Hosein Safarzadeh Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
description	Using panel data analysis, this paper examines the relationship between corporate governance and quality of reported earnings. The sample is comprised of 117 listed in Tehran Stock Exchange (TSE) during the period of 1386-1388. Prior research has used many surrogates for corporate governance. However, the criticism of the extant research has been that corporate governance comprises many facets and is not uni-dimensional. Quality of earnings is measured in seven ways. Empirical tests demonstrate that the overall governance measure is 1) negatively related to the accrual quality, earnings persistence, earnings management and conservatism, 2) positively related to the earnings predictability and earnings timeliness, and 3) not related to the value relevance. In other words, the results suggest that there are multiple dimensions to the relationship between earnings quality and corporate governance that preclude supporting the spirit of either the monitoring or the assurance hypotheses. Furthermore, our results suggest that disaggregating corporate governance measure into more components cause to decreasing in explanatory power of the models. Finally, the relationship between corporate governance and various measures of earnings quality in different industries is not homogenous.
format	article
author	Kaveh Mehrani Mohammad Hosein Safarzadeh
author_facet	Kaveh Mehrani Mohammad Hosein Safarzadeh
author_sort	Kaveh Mehrani
title	Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
title_short	Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
title_full	Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
title_fullStr	Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
title_full_unstemmed	Explaining the Relationship between Corporate Governance and Earnings Quality in Iran
title_sort	explaining the relationship between corporate governance and earnings quality in iran
publisher	Shahid Bahonar University of Kerman
publishDate	2011
url	https://doaj.org/article/7ba54a9414c4426890f840c2db3940cf
work_keys_str_mv	AT kavehmehrani explainingtherelationshipbetweencorporategovernanceandearningsqualityiniran AT mohammadhoseinsafarzadeh explainingtherelationshipbetweencorporategovernanceandearningsqualityiniran
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Explaining the Relationship between Corporate Governance and Earnings Quality in Iran

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