stock exchange
Mahdi Saghafi; Azam Pouryousof; Fatemeh Dastgerdi
Abstract
The aim of the present research is to examine the impact of the heterogeneity of knowledge among board members on the Optimistic tone of explanatory reports, as well as to investigate the mediating role of earnings management in this relationship In fact, it is expected that differences in the characteristics ...
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The aim of the present research is to examine the impact of the heterogeneity of knowledge among board members on the Optimistic tone of explanatory reports, as well as to investigate the mediating role of earnings management in this relationship In fact, it is expected that differences in the characteristics of the management team of a company may influence the quality of both quantitative and qualitative financial reports To test the research hypotheses, panel data from 125 companies listed on the stock exchange over a 9-year period (from 2014 to 2021) were used The estimation of the research models using multivariate regression shows that the heterogeneity of managers' knowledge positively and significantly affects the Optimistic tone of explanatory reports, and earnings management also has a positive and significant impact on the Optimistic tone of managers' explanatory reports Ultimately, earnings management can play a mediating role in the relationship between the heterogeneity of managers' knowledge and the Optimistic tone of explanatory reports The results of this study provide a different perspective on the role of the executive management team in companies and offer valuable insights for the existing literature on the strategic leadership role of senior managers and the disclosure of annual board reports
Accounting report
Jafar Babajani; Mohammad Javad Salimi; Mhammad taghi Taghavi fard; Ehsan Mohebi
Abstract
Regional Electric companies are organizations that pursue both social and financial goals in order to fulfill their assigned missions, so fulfilling accountability for their dual goals is of fundamental importance. In this research, by examining the information needs of the users of the financial reports, ...
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Regional Electric companies are organizations that pursue both social and financial goals in order to fulfill their assigned missions, so fulfilling accountability for their dual goals is of fundamental importance. In this research, by examining the information needs of the users of the financial reports, the factors affecting the financial reporting of the sector have been studied. The aim of this research is to present a model for the environmental conditions and characteristics of regional electric companies in Iran. For this purpose, the required data, after a library study and exploratory search in the theoretical foundations and financial and accounting rules and regulations governing the relations of these entities, were collected using a questionnaire and analyzed using the fuzzy Delphi research method and appropriate statistical tests. The evidence from the analysis of the respondents’ views shows that the influencing factors are in four dimensions, including the compatibility of the model in achieving the organization's goals, the needs of information users, compliance with financial and accounting laws and regulations, and finally, budget control and credit status reporting. Experts also agree on the factors proposed by this research for designing and explaining the financial reporting model of regional power companies in Iran.Introduction The government and other public sector institutions provide many goods and services essential to society. One of the most significant areas in which the government engages in commercial activities is the energy sector, particularly the electricity industry, which plays a key role in social and economic development and in improving the quality of life in society. The financial resources of the country’s regional electricity companies are derived from various sources and must be utilized for specific purposes in compliance with various laws and regulations.Given the fundamental importance of performance and the evaluation of accountability by authorities to stakeholders in democratic governments, it is necessary to produce clear and reliable reports on how resources are allocated and consumed in different areas. This research seeks to identify the weaknesses and shortcomings of the financial statements of these institutions by reviewing existing literature and employing other methods. Ultimately, the study presents a suitable model for the financial reporting of these institutions, enabling improved accountability and more effective economic decision-making.Research QuestionWhat is the financial reporting model of Iran's regional electricity companies?Literature ReviewSayedi and Babajani (2011) conducted research with the aim of achieving a desirable model of financial reporting in Islamic capital markets. The findings of their research confirmed the usefulness of relying on the fund theory to achieve reporting goals. The result of their study led to a financial reporting model in which the central focus is not the economic entity but rather the main business activities and departments of the company.Babajani and Shekarkhah (2012), using the Delphi method, investigated the appropriate accounting model for Islamic banking in Iran. According to their findings, the accounting system used by experts was unable to meet user needs and required changes, the generalities of which were presented as key factors in the proposed research model. Additionally, the research indicated that a conceptual framework based on accountability is more suitable than one based on decision-usefulness for financial reporting in the usury-free banking system.Mohammadi et al. (2020), in their research to develop a desirable model of financial reporting in the public sector, addressed the key factors influencing public sector financial reporting. The results showed that the quality of public sector financial reporting is influenced by factors such as budgeting structure, public sector infrastructure, the quality of human resources, the accounting system and basis, education, and the accountability system governing society. Weaknesses identified in the research include poor implementation of accrual accounting, incomplete implementation of operational budgeting, political influence in decision-making processes, lack of access to the annual budget performance statement and budget deduction report, and non-identification of certain financial statement items.MethodologyThe current research is an applied and developmental study. It aims to analyze existing conditions and assist in the decision-making process, classifying it as descriptive research. Furthermore, since it seeks to gather the opinions of a large statistical community on the research subject, it is categorized as descriptive-survey research.Using the fuzzy Delphi method, the statistical population includes experts selected based on three criteria: the presence of representatives from expert groups, deep knowledge of the research topic, and breadth of opinion and expertise. These experts were chosen from groups such as auditors, the head of the State Court of Audit, auditors of executive bodies, directors of audit organizations, and academic faculty members with relevant experience. Participants were selected through snowball sampling.Initially, to identify the dimensions, components, and indicators of the Financial Reporting Model for Regional Electric Companies in Iran, a review of the subject literature was conducted. After identification, examples of these cases in the public sector were examined based on expert opinions. Given the advantages of the fuzzy Delphi method (29FDM) compared to the traditional Delphi method (30TDM), the fuzzy Delphi method was employed in this research.ResultsBy examining the needs of users and the current state of financial reporting for regional electric companies, which is affected by several factors, it was found that the financial reporting models of private sector for-profit institutions cannot fully address the information needs of users in this sector. The findings of this research revealed that the operating environment and user needs in this sector differ significantly from those of private-sector for-profit institutions. These differences have created challenges in aligning the information needs of users with the form and content of the current financial reports, leaving report users facing difficulties.In this research, by identifying and analyzing the factors influencing an appropriate financial reporting model for Iran's regional electric companies, a step has been taken to better meet the information needs of users. Identifying the set of influencing factors for the proposed model, in accordance with the conditions and laws governing the financial and accounting systems of this sector, and determining the importance of each factor in the desired framework are among the key findings of this research effort.DiscussionAccording to the findings of the research, the consistency of the model in reporting the degree of achievement of the set goals of regional electric companies, the consistency in supporting the goals of information users, its compliance with financial and accounting rules and regulations, as well as budget control and credit status reporting, were identified as the effective dimensions of the reporting model. Each of these dimensions comprises several components and indicators.ConclusionThis research aimed to present a financial reporting model for Regional Electric Companies in Iran. Using the fuzzy Delphi method and based on expert opinions, the dimensions, components, and indicators of the proposed model were identified and presented.
Accounting report
Mohammad Javad Salimi; Ghassem blue; Maghsoud Amiri; Hamed Zakeri
Abstract
The earnings forecasts report is considered as one of the most important and effective reports in investors' decision-making. The purpose of this study is to present an earnings forecasts reporting framework in Iran's capital market. To achieve this research goal, the earnings forecasts reporting framework ...
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The earnings forecasts report is considered as one of the most important and effective reports in investors' decision-making. The purpose of this study is to present an earnings forecasts reporting framework in Iran's capital market. To achieve this research goal, the earnings forecasts reporting framework was identified first by studying the theoretical foundations and the background of the research, as well as interviewing 21 experts using the snowball method and the theme analysis method. Then, through the implementation of the fuzzy Delphi method and solicitation of opinions from 183 experts using a questionnaire and targeted judgmental sampling method, a consensus was reached on the reporting framework, resulting in the presentation of the earnings forecasts reporting framework in Iran's capital market. The research population included university faculty members, employees in regulatory organizations, investors, auditors, and providers of financial information. The research results showed that out of 122 detailed themes extracted through theme analysis, categorized into six main themes and 14 sub-themes, 97 detailed themes obtained the consensus among the Delphi group, thereby forming components of the earnings forecasts reporting framework. The main elements of the earnings forecasts reporting framework encompass generalities, environmental fields, characteristics, consequences, challenges, and evaluation. The findings of this research can serve as a guide for developing financial reporting standards and modifying procedures and regulations.IntroductionThe management forecasts earnings is one of the disclosed information outside the financial statements, which reflects the management's forecast about the future prospects. This report is one of the most important sources of information for companies in the capital market. Corporate management possesses considerable information advantages about contingencies related to future profitability. Management disclosures are considered a valuable and potential source of information for investors. Investors are interested in estimating the future benefits of their investment so that they can assess receiving future cash earnings as well as the value of their shares. Therefore, the expected earnings from companies are important for investors and beneficiaries to make investment decisions.How to present the earnings forecast report has been a challenging issue in recent years. Therefore, in the current situation, examining the framework and reporting method of earnings forecasting in the Iranian capital market using the opinions of experts is regarded as an essential need.Considering the importance of earnings forecast reporting for investors, the problem of the current research is: What is the earnings forecast reporting framework in Iran's capital market? Additionally, what are the components of this framework based on the country's economic and capital market conditions? Literature ReviewThere are several reasons for disclosing the information of managers and publishing the earnings forecast report. One reason for this is agency theory, which refers to the conflict of interests between managers and owners. In addition, we can refer to the Signaling theory, Expectation adjustment hypothesis, and Legal liability hypothesis.The primary framework of earnings forecasting reporting includes the purpose, users, limitations, environmental fields, characteristics, and consequences.Hirst et al. (2008) provided a framework regarding management earnings forecasting. They categorized earnings forecasts into three components including antecedents, characteristics, and consequences. They concluded that earnings forecasting characteristics are less explored in both theoretical and empirical research, despite managers having the most control over this component.Preussner and Aschauer (2022) synthesized the literature on management earnings forecasts and adaption mechanisms, combined existing theories into a unifying framework. Overall, the literature review provides strong support for a positive correlation between the extent and credibility of management earnings forecasts, on the one hand, and stock returns, share liquidity, and analyst coverage, on the other hand. Earnings forecasts tend to be optimistically biased, with a positive correlation with forecast uncertainty, earnings flexibility, financial distress, investor sentiment, and the share price dependency of managers' remuneration. Firm growth, legal liability, and litigation risk are significantly associated with forecast pessimism.Until 2017, listed companies in Tehran Stock Exchange published an independent report titled earnings forecasts report. The Securities and Exchange Organization announced in a notification that since January 2018, the Issuers are not allowed to publish earnings forecasts report. Instead, they are required to prepare and disclose the management's interpretive report alongside the interim and annual financial statements. Recently, as of July 2021, the return of the earnings forecast report was announced with a new procedure for five industries.MethodologyTo achieve the goal of the research, the primary framework was first identified by studying the literature review and theoretical background. Semi-structured interviews were then conducted with 21 experts using the snowball sampling method. The data from the interview was analyzed using the theme analysis method and the earnings forecasts reporting framework was extracted according to the country's environmental characteristics. Finally, the fuzzy Delphi method was implemented and opinions were gathered from 183 experts through a questionnaire and targeted judgment sampling method to reach a consensus on the earnings forecasts reporting framework.The statistical population of the research included university faculty members, employees in regulatory organizations, investors, auditors, and providers of financial information.ResultsThe research results showed that out of 122 detailed themes extracted through theme analysis, which were categorized into 6 main themes and 14 sub-themes, 97 detailed themes obtained consensus from the Delphi group and were identified as components of the earnings forecasts reporting framework. The main themes of the framework are generalities, environmental fields, characteristics, consequences, challenges, and evaluation. Each main theme consists of sub-themes. For example, the generalities theme includes sub-themes such as purpose, users, and limitations. The environmental fields theme covers aspects related to the forecast environment and company characteristics. The characteristics theme encompasses the method of publishing, features, text of the report, and assurance. The consequences theme addresses the consequences of publishing and non-publishing. The challenges theme explores the challenges in the environment and the company. Lastly, the evaluation theme focuses on the evaluation of the disclosure procedure.DiscussionThe findings of this research can serve as a valuable guide for developing financial reporting standards and modifying procedures and regulations.The paper has some limitations. The use of questionnaires, which is common in humanities research, is inherently limited, and this research is no exception. The time limitation, the diverse knowledge base of the experts, and their interest in the research topic may have influenced the quality of the experts' responses to the questionnaire.ConclusionThis research has presented the earnings forecasts reporting framework in Iran's capital market, consisting of 6 main themes. The results of this study can help Iran's Accounting Standards Development Committee in developing standards. Furthermore, the Securities and Exchange Organization can use the framework, particularly for the evaluation theme to modify and present regulations related to earnings forecasting reporting. Additionally, investors can use the results of this research to enhance their understanding about the earnings forecast report and make more informed investment decisions. Issuers can also use the framework to improve information disclosure and prepare reports.AcknowledgmentsI am grateful to all the esteemed professors and experts who helped me in this way. I would also like to express my gratitude to the staff of Allameh Tabataba’i University for their cooperation.
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.
Accounting report
iman zare
Abstract
Improving the quality of financial reporting is one of the effective factors to approach an efficient capital market and optimal capital allocation, the present research tries to explain the quality of financial reporting from the perspective of adjusted structuration theory. The adjusted structuration ...
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Improving the quality of financial reporting is one of the effective factors to approach an efficient capital market and optimal capital allocation, the present research tries to explain the quality of financial reporting from the perspective of adjusted structuration theory. The adjusted structuration theory explains social systems, including accounting, with an ethical approach and considering the dual relationship between agency and structure.The current research is quantitative in terms of implementation method. In the quantitative part, the correlation method based on confirmatory factor analysis and structural equation modeling was used. The statistical population of the research includes university faculty members and financial managers 154 people were selected by available sampling method. The research tool is an extractive questionnaire from research literature. The analysis of data in the quantitative part in the form of structural equation model showed that the relationship between agency and accounting structure with the quality of financial reporting is strongly significant and agency has a higher rating in this relationship, this relationship is due to the influence of an opinion based on ethics with the first rank, decision-making with the second rank and accountability with the third rank will be from the direction of agency and structure on the quality of financial reporting. the accounting system with emphasis on adjusted structuration Theory increases the quality of financial reporting by providing a comprehensive theoretical framework based on the usefulness and ethics of the accounting system as well as the usefulness of information for decision making.
Accounting report
Ali Rahmani; Azam Valizadeh Larijani; Elham Rabihavi
Abstract
The need for a set of qualified accounting standards has led to the development of international financial reporting standards. like many other countries globally, Iran has adopted these standards and required their application in a group of capital market companies. The main purpose of this study is ...
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The need for a set of qualified accounting standards has led to the development of international financial reporting standards. like many other countries globally, Iran has adopted these standards and required their application in a group of capital market companies. The main purpose of this study is to examine the challenges and benefits of implementing International Financial Reporting Standards from the perspective of the executives who are required to use the standards. The statistical population of this study, consisting of managers of banks, insurance companies and, stock exchange companies, are required to comply with IFRS according to the enactment of the Stock Exchange and Securities Organization, which includes a total of 77 companies. The collection tool of this research is a questionnaire that was distributed from September to October 2016. The answers to 59 questionnaires were received from 77 distributed questionnaires. For banks, the biggest challenge was the cost of training at the level of companies and users of financial information, for insurers it was the difference between tax laws and international financial reporting standards, and for other companies, the lack of accountants and auditors that have the technical skills of implementing international financial reporting standards.
Mohamad ali Aghaei; Ali asghar Anvari Rostami; vahid Ahmadian; Ghasem Montazeri
Volume 10, Issue 38 , July 2013, , Pages 1-27
Abstract
Iranian Financial Accounting Standards Board applies a hierarchy of accounting qualities and asserts that the relative importance of these qualities differs between decision makers. In the article, the relative importance of qualities based on prepares, auditors and users of financial reports assertions ...
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Iranian Financial Accounting Standards Board applies a hierarchy of accounting qualities and asserts that the relative importance of these qualities differs between decision makers. In the article, the relative importance of qualities based on prepares, auditors and users of financial reports assertions are examined. At the first, sample was determined using conventional methods. Then, the respondent’s judgment of each group was captured by using of questionnaires. The survey questionnaire was based on the Analytic Hierarchy Process. The respondent’s judgment (a series of trade-offs between pairs of the qualities) was analyzed using SPSS and Expert Choice. The results revealed that based on users assertions, except comparability, the relative importance of the accounting information qualities are different..
V Khodadadi; M Arabi; F Taheri
Volume 9, Issue 34 , July 2012, , Pages 151-172
Abstract
The timing of an annual report announcement is a disclosure decision that managers must make. The users recognize timeliness as an important characteristic of usefulness of accounting information. In this research, we investigate relationship between a set of explanatory variables (such as returns on ...
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The timing of an annual report announcement is a disclosure decision that managers must make. The users recognize timeliness as an important characteristic of usefulness of accounting information. In this research, we investigate relationship between a set of explanatory variables (such as returns on equity, changs of stock return, financial risk and size) and timing of annual financial reporting. we have used the financial data of 88 firms listed at Tehran Stock Exchange (TSE), that have analyzed for during 2004 to 2010 by using of the Panel Data System and Ordinary Least Square Regressions (OLS) Model. The results of regression show that timeliness in reporting by TSE listed companies is influenced by their profitability. We find that returns on equity and changes in stock returns are positively associated with the annual financial reports earlier and financial risk and changes in financial risk are negatively associated with the annual financial reports earlier. In addition, the results indicate that the timing of annual report releases is significantly affected by company size.
A. Rahmani; Z. Bayati
Volume 8, Issue 30 , July 2010, , Pages 59-77
Abstract
Pension plans accounting is a controversial issue. Providing the defined benefits pension plans in companies' financial statements is very important considering the lack of accounting standard in Iran in this regard, and most of the financial statements users are interested in true understanding of companies' ...
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Pension plans accounting is a controversial issue. Providing the defined benefits pension plans in companies' financial statements is very important considering the lack of accounting standard in Iran in this regard, and most of the financial statements users are interested in true understanding of companies' pension plans. The number of such companies which are qualified to entering in Tehran Stock Exchange (TSE) has increased; hence economic consequences of measuring and releasing of obligations have been noteworthy.
The current research studies uniformity of pension plans in financial statements reporting and necessity of creating a new standard in this regard.
The sample population of this research are 9 companies and banks that have had defined benefits pension plan for the financial year of 1388. Also the data of research has been collected using viewpoint of expertise and persons questionnaire. Examines of binominal distribution, chi square and mean have been applied for analyzing of data.
Results of this study, indicates the lack of uniformity in reporting pension plans in financial statements of employer and entities which have mostly use recognition rather disclosure. However some incompetence is in recognition and disclosure.
Also from viewpoint of pension plan financial statements users, releasing of pension plans information is useful, so they believe it is necessary that a new standard should be created.
Abbas Hoshi
Volume 4, Issue 16 , January 2007, , Pages 91-125
Abstract
The financial statements accompanied by independent auditors’ unqualified report which presents to capital market are used by interested beneficiary users. According to rules and regulations of the capital market, acceptance of the companies in the stock exchange list and its continuity requires ...
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The financial statements accompanied by independent auditors’ unqualified report which presents to capital market are used by interested beneficiary users. According to rules and regulations of the capital market, acceptance of the companies in the stock exchange list and its continuity requires transparent financial reports free of material misstatements.
Therefore name of those companies that have adverse or disclaimer audit opinion on their financial reports will be deleted from stock exchange list resulting unfavorable consequences for the company and its beneficiary users.
In capital market of many countries including China, in case of qualified audit report that includes serious explanatory paragraphs affecting financial statements, the companies would have specific period of time to remove the deficiencies and to have the opportunity to issue corrected (restated) financial reports. In Iran’s capital market, issuing adjusted audit reports is more common, hence in this research we study the factors affecting desirability of financial reporting in the frame work of giving them credibility through issuance of unqualified audit report.
In this study, 143 companies listed in stock exchange are selected through a statistical process and examined for a period of seven years, and thus the factors and variables affecting the companies’ financial reporting are determined in the capital market.
The research findings show that during the period under review the financial reporting have improved and benefited a favorable trend in the capital market.
Ali Saghafi; Mohammad Arab Mazaryazdi; Rafik Baghomian
Volume 3, Issue 10 , July 2005, , Pages 127-156
Abstract
The fast moving pace of developments on the Information and Communication Technologies (ICT) and especially on the Internet, affects all aspects of society. In accounting, the Internet provides a new and revolutionary method of financial reporting. It is fast, cheap and increasingly accessible to shareholders ...
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The fast moving pace of developments on the Information and Communication Technologies (ICT) and especially on the Internet, affects all aspects of society. In accounting, the Internet provides a new and revolutionary method of financial reporting. It is fast, cheap and increasingly accessible to shareholders and other stakeholders of the firms.
Despite above mentioned evolution, there is a little attention toward such changes in Iran.
The organization of this paper is as follows. It first provides a brief literature review of Internet Financial Reporting (IFR) and describes some theoretical approaches on i t. Thereafter the paper reports current situation of IFR and then predicts immediate and future trends of it. The last section reviews the current situation of IFR i n Iran and finally makes suggestions to improve the situation.
