Yadollah Tarivardi; Salahoddin Ghaderi
Abstract
Audit Committee is a key element of corporate governance. The knowledge and understanding of experienced Audit Committee members increase the Company's financial reporting and auditing value. The objective of this study is to investigate the impact of audit committee financial expertise on managerial ...
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Audit Committee is a key element of corporate governance. The knowledge and understanding of experienced Audit Committee members increase the Company's financial reporting and auditing value. The objective of this study is to investigate the impact of audit committee financial expertise on managerial short-termism in Tehran Stock Exchange listed companies. To measure managerial short-termism, we used three criteria: discretionary accruals and the actual items (through manipulation of sales and a reduction in discretionary spending). Tehran stock exchange listed firms constitute statistical population of the research. The sample consists of companies that had been listed on Tehran Stock Exchange before 2012 and have audit committee in the years 2013 to 2016. Financial expertise of audit committee members had no significant effect on earnings management on the basis of accruals. The investigation of the effect of audit committee financial expertise on real earnings management revealed that audit committee financial expertise has a negative effect on the real earnings management through manipulation the sales and reducing discretionary spending. These findings are useful for policy makers to formulate useful obligations regarding the Charter of the Audit Committee and the necessity of applying the principles of corporate governance and preparing voluntary corporate governance report.
Hossien Fakhari; Javad Mohammadi; Mohsen Hasannataj Kordi
Abstract
The novelty and mandatory rules about establishing of the auditcommittee in Iranian listed companies as one of the important part ofcorporate governance are controversial subject. It has been importantespecially when the real earnings management is involved. It is due to thepossibility of the detection ...
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The novelty and mandatory rules about establishing of the auditcommittee in Iranian listed companies as one of the important part ofcorporate governance are controversial subject. It has been importantespecially when the real earnings management is involved. It is due to thepossibility of the detection of real earning management that is low incomparison with accrual earning management. In companies this researchintend to investigate about audit committee characteristic and real earningmanagement in Iranian listed companies. So we gather data about 112 listedcompanies of TSE during 1392 year and analysis them with cross-sectionalregression.In general our findings show that there is a significant relationshipbetween audit committee characteristics and real earnings management. Alsoour findings help to TSE policy maker for reporting and enforcement ofaudit committee charter. It indicates also that there is a vital need forapplying of corporate governance rules in Iranian listed companies
