Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange

The purpose of this study is to examine the joint effects of corporate governance and earnings management on stock liquidity, measured by trading volume. In this study, the data was collected from 154 companies listed in the Tehran Stock Exchange, in the period 2008 to 2015. The tests of hypotheses...

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Autores principales:	Kaveh Mehrani (Ph.D), Alireza Nasiri Farvazi
Formato:	article
Lenguaje:	FA
Publicado:	Shahid Bahonar University of Kerman 2017
Materias:	corporate governance earning management market liquidity Accounting. Bookkeeping HF5601-5689
Acceso en línea:	https://doaj.org/article/b83e48a15ee543fab8c0323b60e2e505
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spelling	oai:doaj.org-article:b83e48a15ee543fab8c0323b60e2e5052021-11-04T19:52:37ZImpact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange2008-89142476-292X10.22103/jak.2017.1645https://doaj.org/article/b83e48a15ee543fab8c0323b60e2e5052017-05-01T00:00:00Zhttps://jak.uk.ac.ir/article_1645_64166c1cabde3ae5c1c5219a4fe06e34.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XThe purpose of this study is to examine the joint effects of corporate governance and earnings management on stock liquidity, measured by trading volume. In this study, the data was collected from 154 companies listed in the Tehran Stock Exchange, in the period 2008 to 2015. The tests of hypotheses were carried out, using ordinary linear regression method. The results showed that the relationship between the two corporate governance variables, measured by the concentration rate of audit committee and the independence rate of directors, is significantly positive, and that the relationship between the other mechanism variable, called as ownership concentration rate and trading volume is significantly negative. Also, it was concluded that the relationship between earning management and trading volume is significantly negative. The earning management variable was measured by Defond and Park model, using difference between the realized working capital and the expected working capital to sustain current sales level. When we examined the joint effects of corporate governance and earnings management on stock liquidity, controlling the former to explore the potential effects of the latter, the result showed lack of significant relationship between earning management and trading volume.Kaveh Mehrani (Ph.D)Alireza Nasiri FarvaziShahid Bahonar University of Kermanarticlecorporate governanceearning managementmarket liquidityAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 8, Iss 1, Pp 7-27 (2017)
institution	DOAJ
collection	DOAJ
language	FA
topic	corporate governance earning management market liquidity Accounting. Bookkeeping HF5601-5689
spellingShingle	corporate governance earning management market liquidity Accounting. Bookkeeping HF5601-5689 Kaveh Mehrani (Ph.D) Alireza Nasiri Farvazi Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
description	The purpose of this study is to examine the joint effects of corporate governance and earnings management on stock liquidity, measured by trading volume. In this study, the data was collected from 154 companies listed in the Tehran Stock Exchange, in the period 2008 to 2015. The tests of hypotheses were carried out, using ordinary linear regression method. The results showed that the relationship between the two corporate governance variables, measured by the concentration rate of audit committee and the independence rate of directors, is significantly positive, and that the relationship between the other mechanism variable, called as ownership concentration rate and trading volume is significantly negative. Also, it was concluded that the relationship between earning management and trading volume is significantly negative. The earning management variable was measured by Defond and Park model, using difference between the realized working capital and the expected working capital to sustain current sales level. When we examined the joint effects of corporate governance and earnings management on stock liquidity, controlling the former to explore the potential effects of the latter, the result showed lack of significant relationship between earning management and trading volume.
format	article
author	Kaveh Mehrani (Ph.D) Alireza Nasiri Farvazi
author_facet	Kaveh Mehrani (Ph.D) Alireza Nasiri Farvazi
author_sort	Kaveh Mehrani (Ph.D)
title	Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
title_short	Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
title_full	Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
title_fullStr	Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
title_full_unstemmed	Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange
title_sort	impact of corporate governance and earning management on liquidity in companies in the tehran stock exchange
publisher	Shahid Bahonar University of Kerman
publishDate	2017
url	https://doaj.org/article/b83e48a15ee543fab8c0323b60e2e505
work_keys_str_mv	AT kavehmehraniphd impactofcorporategovernanceandearningmanagementonliquidityincompaniesinthetehranstockexchange AT alirezanasirifarvazi impactofcorporategovernanceandearningmanagementonliquidityincompaniesinthetehranstockexchange
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Impact of Corporate Governance and Earning Management on Liquidity in Companies in the Tehran Stock Exchange

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