Mohammad Hosein Safarzadeh; Sajedeh Tavoosi
Abstract
One of the concepts which recently have been discussed a lot by corporategovernance regulators and standard setters is related party transaction. Related partytransaction due to the complexity in recognition and disclosure are considered to beone the challenges of financial reporting which can influence ...
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One of the concepts which recently have been discussed a lot by corporategovernance regulators and standard setters is related party transaction. Related partytransaction due to the complexity in recognition and disclosure are considered to beone the challenges of financial reporting which can influence economic decisions ofusers. Considering the expansion of related party transactions and the increase ofthem in companies, it is necessary to create monitoring mechanisms to reduce thefinancial frauds and to improve the performance. Among these types of monitoringmechanisms, stablishing and performing of proper corporate governance system incompanies is one of these mechanisms. The empirical evidences show that corporategovernance lessens related party transaction. In this research, the relationshipbetween the mechanisms of corporate governance and related party transactions isinvestigated. The study sample includes 136 Tehran Stock Exchange listedcompanies from 1389 to 1393. In order to test the research hypotheses, the multivariableregression model with a data panel was used. The board membersindependences, boards compensation, stock ownership, change of executivemanager, auditor rotation were used as the corporate governance mechanisms. Theresult of the research indicates that there is a significant and reverse relation betweenrelated party transaction and ownership of the institutional stockholders and changeof executive manager. There is a reverse relation between related party transactionand autonomy of board of managers’ members but this reverse relation is notsignificant statistically. There is a direct and significant relation between relatedparty transaction and board of managers’ compensation and there is a direct relationbetween related party transaction and auditor rotation, which is not significantstatistically.
Mohammad Arabmazar Yazdi; Mohammad Hosein Safarzadeh
Volume 4, Issue 15 , October 2006, , Pages 1-20
Abstract
This paper provides evidence on relationships between earnings and cash flow measures for the firms accepted in Tehran Stock Exchange (TSE) over a sample of 83 firms during the period of 1376- 1385. In so doing, we examine the external validity of a U.S.A study of these ...
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This paper provides evidence on relationships between earnings and cash flow measures for the firms accepted in Tehran Stock Exchange (TSE) over a sample of 83 firms during the period of 1376- 1385. In so doing, we examine the external validity of a U.S.A study of these relationships by Bowen, Burgstahler and Daley (1986). We also extend their study through an industry analysis of the relationships.
Evidence is presented first that shows low correlations between traditional cash flow measures and a more refined cash flow measure. Second, traditional cash flow measures exhibit high correlations with earnings, while the more refined cash flow measure has a lower correlation with earnings. Finally, traditional cash flow measures better predict future cash flows than models based on earnings or a more refined cash flow measure. The industry evidence shows that the results on the first two issues, but not the latter issue, are generalizable across industry categories.
