Accounting and various aspects of finance
Hassan Badri Gamchi; Mohammad Hassani; Ahmad Yaghoobnezhad; Ehsan Rahmaninia
Abstract
This paper analyzed the consequences of financial reporting convergence towards integrated reporting in Iran's capital market focusing on agency cost and cost of equity capital. In order to measure the financial reporting convergence towards integrated reporting, a checklist has been used which designed ...
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This paper analyzed the consequences of financial reporting convergence towards integrated reporting in Iran's capital market focusing on agency cost and cost of equity capital. In order to measure the financial reporting convergence towards integrated reporting, a checklist has been used which designed based on the international integrated reporting framework. The agency cost measured using the efficiency criterion based on the ratio of operational expenses to operational revenues. The cost of equity capital estimated based on the expected rate of return using the capital assets pricing model. The research population includes 144 firms listed in the Tehran Securities & Exchange over March 2016 till March 2021. Multivariable regression models were used to test research hypotheses. The findings showed that increase in convergence level of firms’ financial reporting with integrated reporting framework has reduced agency cost and cost of equity capital. These findings suggested that focusing on the benefits of integrated reporting through transparency and completeness of information disclosure has weakened agency conflicts and reduced agency costs. In addition, integrated reporting has reduced the cost of capital in financing decisions due to the adoption of sustainable business model from integrated thinking and the reduction of information asymmetry due to greater transparency for more informed forecasting.
Financial Accounting
Mohammad Arabmazar Yazdi; Vahid Mennati; Javad Roshanzamir
Abstract
Financial statement comparability improves the quality of financial information and the information environment, and enabling users to identify similarities and differences between different companies, and evaluating the performance of managers and supervising them. So, it is expected that increasing ...
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Financial statement comparability improves the quality of financial information and the information environment, and enabling users to identify similarities and differences between different companies, and evaluating the performance of managers and supervising them. So, it is expected that increasing the comparability of financial statements will limit the opportunism of managers. In this regard, in this study, the relationship between comparability of companies and debt maturity has been investigated. The data of the present study were collected using the financial information of 125 companies listed on the Tehran Stock Exchange in the period 2013 to 2019 (882 observation). To analyze the data, a multivariate linear regression model of the generalized least squares type by utilizing combined data was used. The results showed that there is a negative and significant relationship between the comparability of financial statements and the maturity of the company's debt. Therefore, it can be concluded that the Financial statement comparability plays an important role in aligning incentives in the company and by reducing information asymmetry and potential agency costs, can substitute for the use of short-term debt by serving as a corporate governance mechanism.
Mohamad Namazi; gholamreza Rezaie
Volume 11, Issue 44 , March 2015, , Pages 37-69
Abstract
The purpose of this research is to study the effects of the accruals quality and the information relevance on the agency costs for the companies listed in Tehran Stock Exchange (TSE). Hence, an attempt will be made to answer the following question: “Is there a significant relationship between the ...
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The purpose of this research is to study the effects of the accruals quality and the information relevance on the agency costs for the companies listed in Tehran Stock Exchange (TSE). Hence, an attempt will be made to answer the following question: “Is there a significant relationship between the accruals quality and the information relevance and agency costs?”. To find the answer, this research utilizes the operating expenses to sales ratios, asset turnover ratios, and Q-tobin’s ratios were employed as proxies for the agency costs. The statistical population of the study consists of 67 companies of the TSE during 2003 to 2010; and the multivariate regression is used. The results suggest that there is a reverse relationship between accruals quality, accruals quality that is adjusted according to performance and information relevance, and the agency costs criteria (i.e., operating expenses to sales ratios, asset turnover ratios, and Q-tobin’s ratios).
Mahdi Moradzadehfard; Maryam Farajzadeh; Shima Karami; Morteza Adlzadeh
Volume 11, Issue 44 , March 2015, , Pages 97-116
Abstract
The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting ...
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The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting from all companies listed in Tehran Stock Exchange using removal method over the time span of 2006-2010. Combined data method with fixed effect has been used in order to test the research hypothesis. The result depicts that the association between conservatism and investment is significantly negative when a firm do not need external financing. Nonetheless, this association is significantly positive in companies which need external financing. Furthermore, we find that the relationship between conservatism and investment in the companies whose ultimate ownerships controller is governmental or semi governmental firms is significantly negative. Thus, when the agency problem is enhancing, conservatism acts as a mechanism to decrease this problem and engenders reduction in investment cost
Mahdi Moradzadeh Fard; Maryam Farajzadeh; Shima Karami
Abstract
The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting ...
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The purpose of this research is to examine both the relationship between accounting conservatism and level of investment under the need or no need of financing conditions and the impact of ultimate ownership on this association. The statistical society of the present research contains 103 companies selecting from all companies listed in Tehran Stock Exchange using removal method over the time span of 2006-2010. Combined data method with fixed effect has been used in order to test the research hypothesis. The result depicts that the association between conservatism and investment is significantly negative when a firm do not need external financing. Nonetheless, this association is significantly positive in companies which need external financing. Furthermore, we find that the relationship between conservatism and investment in the companies whose ultimate ownerships controller is governmental or semi governmental firms is significantly negative. Thus, when the agency problem is enhancing, conservatism acts as a mechanism to decrease this problem and engenders reduction in investment cost.
Javad MOradi; Ahmad Rahmanian
Volume 10, Issue 40 , January 2014, , Pages 125-150
Abstract
Managers' tendency to overinvestment is one of the agency costs that due to conflict of Interests between managements and shareholders the firms are encountered with. Whilesuchactivities increase personal interestsof managements, they will reduce the firm value. Increasing the debt is a potential solution ...
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Managers' tendency to overinvestment is one of the agency costs that due to conflict of Interests between managements and shareholders the firms are encountered with. Whilesuchactivities increase personal interestsof managements, they will reduce the firm value. Increasing the debt is a potential solution for the overinvestment problem. This study investigates the impact of long term debts on overinvestment (with respect to cash and capital expenditures) and also, it examines the impact of growth opportunities on this overinvestment.The statistical society of this research includes companies accepted in Tehran Stock Exchange (TSE) andthe sample consists of 90 firms which are selected based on some constraints for the period of 1379 to 1389. Regression analysis and t-test are utilized to examine the hypothses.The resultsshow that there is a negative and significant relationship between long-term debt changes and overinvestment (in cash and capital expenditure) and the mean of overinvestment in cash and capital expenditure in firm with less growth opportunities, is more
Mohammad Namazi; Javad Moradi
Volume 3, Issue 10 , July 2005, , Pages 73-101
Abstract
In today's developed corporations, because of multiplicity of owners, direct monitoring of managers' performance is impossible, but this group only realizes the released benefits. Therefore, it is reasonable that they use governance mechanisms, for monitoring and optimal controlling behavior of hired ...
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In today's developed corporations, because of multiplicity of owners, direct monitoring of managers' performance is impossible, but this group only realizes the released benefits. Therefore, it is reasonable that they use governance mechanisms, for monitoring and optimal controlling behavior of hired managers. One means in reaching this purpose is rewarding managers based on their performance and motivating them, in accordance with the firm's purposes, in the manner discussed in the agency theory.
The main purpose of this paper is to examine the agency theory implications to isolate market determinants of board of director's bonuses, on the basis of data collected from Tehran's Securities Exchange (TSE) market for 1378 to 1382. For this purpose, by utilizing a regression model, board of director's bonus for selected corporation, were related to some accounting and market-based performance measures as well as some fixed variables (with respect to performance) such as the firm's size and the ownership concentration.
The results at the level of all corporations suggest that there is a significant relationship between Return on Assets (ROA) ratio and its changes, firm's size, ownership centralization, financial risk and board of directors' bonus. At the industry level, both the firm's size and ROA ratio were used more than the other selected variables. By substituting "changes in bonus" for the bonus itself, the explanatory power of the model used, was weakened. In this stage, the only variable that is significantly related to changes in bonuses is the ROA ratio.
