Information asymmetry, sticky costs and conditional accounting conservatism (case study of listed firms in Tehran Stock Exchange)

2016 ◽  
Vol 6 (10) ◽  
pp. 87
Author(s):  
Abdol Rahman Narouei
Keyword(s):  
Information Asymmetry ◽  
Stock Exchange ◽  
Accounting Conservatism ◽  
Listed Firms

Accounting conservatism and money laundering risk

2020 ◽  
Vol 33 (2) ◽  
pp. 343-361
Author(s):  
Meysam Bolgorian ◽  
Ali Mayeli
Keyword(s):  
Money Laundering ◽  
Stock Exchange ◽  
Risk Measure ◽  
Negative Relationship ◽  
Accounting Conservatism ◽  
Firm Characteristics ◽  
Firm Level ◽  
Content Type ◽  
Listed Firms ◽  
Specific Effects

Purpose This paper aims to investigate the relationship between accounting conservatism and money laundering risk. For this goal, the authors construct an index for measuring money laundering risk at the firm level for Iranian listed firms in the Tehran Stock Exchange. Design/methodology/approach In this study, the authors use a sample of 924 firm-year observation of Iranian listed firms for the period of 2012-2017. The authors use three approaches for testing our prediction that more conservative firms are less likely to be involved in money laundering activities. A balanced panel regression model has been used for testing the prediction. Findings The paper results suggest that there is a negative relationship between conditional conservatism and money laundering risk. Furthermore, the authors have shown that the result is robust to controlling for different firm characteristics variables and also industry specific effects. Research limitations/implications Further research in other financial markets is needed to confirm the results generally. Practical implications The evidence in this paper indicates that the degree of accounting conservatism contains important information which can be used by the investors and regulators for managing and controlling the risk of money laundering in the firms. Originality/value By constructing a money laundering risk measure at the firm level for the first time, the authors provide evidence on relationship between conservatism and money laundering risk in Iran.

scholarly journals Accounting conservatism and earnings management constraints

2014 ◽  
Vol 10 (2) ◽  
pp. 1828-1836
Author(s):  
Gholamreza Karami
Keyword(s):  
Panel Data ◽  
Earnings Management ◽  
Stock Exchange ◽  
Rapid Development ◽  
Accounting Conservatism ◽  
Significant Relation ◽  
Listed Firms ◽  
Jones Model

The main purpose of this research is to review the relation between accounting conservatism and the limit to earnings management in case of Tehran Stock Exchange (TSE).  There are numerous studies about the noted relation, in countries which their market capital is the main source of firms financing. However, as long as rapid development of TSE, necessity of such studies become more obvious in Iran. So, by analyzing data gathered from 86 listed firms at TSE for years 1380 to 1391, the relation between accounting conservatism and earnings management restrictions was tested using panel data. Givoly and Hayn (2000) approach for measuring accounting conservatism and adjusted jones model for measuring accruals based earnings management were used. The result shows that there is significant relation between accounting conservatism and earnings management restrictions.

scholarly journals Accounting Conservatism in Stock Price Downfall Risk in "Tehran Stock Exchange"

2015 ◽  
Vol 16 (SE) ◽  
pp. 495-502
Author(s):  
Sahar Taremi ◽  
Bamdad Partovi
Keyword(s):  
Financial Reporting ◽  
Significant Relationship ◽  
Stock Price ◽  
Stock Exchange ◽  
Hypothesis Test ◽  
Accounting Conservatism ◽  
Good News ◽  
Stock Value ◽  
Research Company

As the economic departments' managers tend to report good news, they simultaneously try to conceal bad news. Conservatism procedures not only resist against these tendencies of management, but also they decrease the investment risk in stock. In this research, the relationship between accounting conservatism and the risk related to downfall of stock value has been studied using historical data about 29 car and pieces companies accepted in Tehran Stock Exchange during the years 2010- 2012. The results obtained from performing the logistic regression model show that there is a negative and significant relationship between the risk of stock value decline and the level of conservatism for case-study statistic sample companies. In other words, during the research period, those companies in which the more conservative procedures have been applied in financial reporting, they have less encountered the risk of stock value decline. In the present research, company size was involved as a controlling variable in hypothesis test pattern that a significant relationship wasn't observed between this variable and the research's dependent variable.

scholarly journals THE DETERMINANTS OF MANAGEMENT FORECASTS ERROR AND THE IPO UNDERPRICING: A CASE STUDY OF INDONESIAN IPO

2011 ◽  
Vol 3 (2) ◽  
pp. 136-152
Author(s):  
Yanthi Hutagaol ◽  
Florens Siauw ◽  
Irwan A. Ekaputra
Keyword(s):  
Information Asymmetry ◽  
Stock Exchange ◽  
Market Condition ◽  
Forecast Errors ◽  
Management Forecasts ◽  
Ipo Underpricing ◽  
Earning Forecast ◽  
Expected Earnings ◽  
Forecast Interval

To reduce the well-known information asymmetry in the IPO market, the issuing firms are required to publish offering prospectuses. One type of information disclosed in the prospectus is the management financial forecasts in which the IPO firms predict expected earnings at the end of year after the listing. The purpose of this study is to investigate the determinants of forecasted error published by the management in the IPO prospectuses. This study observes six possible determinants that affect the absolute forecast errors (AFE). Furthermore, this study also examines whether the earning forecast errors could explain the IPO stylish underpricing phenomenon.A sample of 124 IPO firms that went public in Indonesian Stock Exchange (prior Jakarta Stock Exchange) during the 1997 – 2005 period. The results show that the research models proposed are valid models. The management AFE is determined by firm size, forecast interval period, industry, and the firm business range.  This study also finds that the AFE is positively related to the IPO underpricing, suggesting that the higher the forecast errors, the more underpriced is the IPO. Moreover, it is also found that market condition also influences the underpricing level in Indonesian IPO market.

scholarly journals PENGARUH KONSERVATISME TERHADAP ASIMETRI INFORMASI (STUDI EMPIRIS PADA PERUSAHAAN MANUFAKTUR DI BEI)

2019 ◽  
Vol 3 (2) ◽  
pp. 1
Author(s):  
Aida Yulia
Keyword(s):  
Information Asymmetry ◽  
Regression Coefficient ◽  
Stock Exchange ◽  
Accounting Conservatism ◽  
Annual Reports ◽  
Test Results ◽  
Research Model ◽  
Book Value ◽  
Asymmetry Of Information ◽  
Negative Effect

The purpose of this study was to determine the effect of accounting conservatism on information asymmetry in the annual reports of companies listed on the Indonesia Stock Exchange.Target population in this study is a manufacturing company listed on the Indonesia Stock Exchange (BEI) with year observations from 2009 to 2011 the number of companies by 23 companies.Of accounting conservatism measurements conducted on 23 companies, the population of the obtained results of all companies that meet more than one measurement assumptions of accounting conservatism with market value to book value ratio greater than 1, so that the company can be classified as a conservative company. From the test results it can be concluded that the regression coefficient of determinant (R2) value 0.240 indicates that accounting conservatism is able to affect the asymmetry of information in the annual reports of companies listed on the Indonesia Stock Exchange amounted to 24.0 percent and the remaining 76.0 percent is influenced by other variables outside of the research model. Piecemeal evidence suggests that accounting conservatism variable regression coefficient of -0.474, (β ≠ 0), meaning that in partial accounting conservatism and significant negative effect of the information asymmetry in the annual reports of companies listed on the Indonesia Stock Exchange. Refers to the requirement that the results of the study reject Ho and accept Ha.  Keywords: Accounting Conservatism and Information Asymmetry

Direct and mediated associations among earnings quality, book-tax differences and the audit quality

2017 ◽  
Vol 15 (3) ◽  
pp. 293-316 ◽  
Author(s):  
Rakia Riguen Koubaa ◽  
Anis Jarboui
Keyword(s):  
Audit Quality ◽  
Stock Exchange ◽  
Earnings Quality ◽  
Structural Equations ◽  
Accounting Conservatism ◽  
Mediation Effect ◽  
Audit Process ◽  
Content Type ◽  
Listed Firms ◽  
Academic Researchers

Purpose The purpose of this paper is to investigate the direct and indirect links between book-tax differences (BTDs) and audit quality using accounting conservatism (proxy of earnings quality). Hence, this paper seeks to extend prior audit quality research. Design/methodology/approach This study uses a sample of Tunisian listed firms on the Tunis Stock Exchange and operating in the industrial and commercial sectors during 2005-2012. This investigation is motivated by structural equations system models that specify both a direct link and an indirect link that is mediated by information reflected in BTDs. Findings The results show that for the Tunisians companies, firms with large BTDs are associated with higher audit quality implies that such BTDs represent an observable proxy for earnings quality that affects auditor decisions. The authors find statistically an indirect link between abnormal BTDs and audit quality that is mediated by earnings quality. The current study also provides evidence that information reflected in BTDs can improve audit quality. Practical implications The findings may be of interest to the academic researchers, practitioners and regulators who are interested in discovering the informational value of BTDs in the audit process. Originality/value This paper extends the existing literature by examining the mediation effect of information reflected in BTDs on relationship between BTDs and audit quality.

scholarly journals Investigating the Impact of Board of Directors on Accounting Conservatism in Kuwait

2020 ◽  
Vol 13 (9) ◽  
pp. 46
Author(s):  
Mejbel Al-Saidi
Keyword(s):  
Boards Of Directors ◽  
Stock Exchange ◽  
Accounting Conservatism ◽  
Board Independence ◽  
Agency Conflicts ◽  
Listed Firms ◽  
Independent Variables ◽  
Financial Firms ◽  
Kuwait Stock Exchange ◽  
The Impact

This study aims to study the influence of boards of directors on the accounting conservatism of non-financial listed firms in Kuwait Stock Exchange (KSE). According to agency theory, accounting conservatism and boards of directors can be considered effective mechanisms for reducing agency conflicts, thereby protecting the interests of investors that used the financial information while also increasing firms’ performance and value. This study sought to build a link between accounting conservatism and boards of directors by using a sample of 87 non-financial firms listed on the KSE at the end of 2019. The study used three independent variables (i.e., board size, board independence, and family directors) and found that none affected accounting conservatism. This study contributes to the literature by identifying the impact of boards of directors on accounting conservatism in Kuwait as no work has been done in this area before.

scholarly journals Analisis Faktor-Faktor yang Memengaruhi Konservatisme Akuntansi

2020 ◽  
Vol 3 (1) ◽  
pp. 29-49
Author(s):  
Nurul Afyani Mumayiz ◽  
◽  
Cahyaningsih Cahyaningsih ◽  
Keyword(s):  
Information Asymmetry ◽  
Stock Exchange ◽  
Capital Intensity ◽  
Accounting Conservatism ◽  
Litigation Risk ◽  
Investment Opportunity ◽  
Panel Data Regression ◽  
Investment Opportunity Set ◽  
Data Regression ◽  
Negative Effect

This study examinesthe effect of information asymmetry, litigation risk, investment opportunity set, and capital intensity on accounting conservatism. This study uses consumer goods sector companies listed on the Indonesia Stock Exchange from 2016 to 2018 as a research sample. The data analysis method used is panel data regression analysis using Eviews 9.0 software.The results showed that information asymmetry has a positive effect while litigation risk has a negative effect on accounting conservatism. Investment opportunity set and capital intensity have not to influence accounting conservatism.Suggestions for further researchers to examine prudence, in addition to accounting conservatism. For companies, investors, and creditorsare expected to pay attention to the level of information asymmetry and litigation risk because it can affect the level of accounting conservatism applied.

scholarly journals The Moderating Effect of Firm Characteristics on the Association Between Accounting Conservatism and Cash Holdings

2019 ◽  
Vol 9 (4) ◽  
pp. 385
Author(s):  
Walid Shehata Soliman
Keyword(s):  
Firm Growth ◽  
Stock Exchange ◽  
Cash Holdings ◽  
Moderating Effect ◽  
Accounting Conservatism ◽  
Firm Characteristics ◽  
Listed Firms ◽  
Growth Opportunity ◽  
Negative Effect ◽  
Egyptian Stock Exchange

Recent studies are interested in the determinants of cash holdings (CASH), some of these studies focus on conservatism, as one of these determinants. In light of a debate on the nature of the association between conservatism and CASH, this paper discusses and investigates the answers for three questions, the first question about the direct association between conservatism and CASH, the second question about the moderating effect of firm characteristics on this association, the third question about the effect of adopting Egyptian Accounting Standards (EAS) since 2016 on the last association. This paper focuses on Egyptian listed firms in Egyptian Stock Exchange (EGX), especially EGX 100, for six years period from 2013 to 2018 for 11 main sectors, 125 firms and 703 unbalances panel data observations. The findings indicate that (1) conservatism has a negative effect on CASH, (2) only firm size has a moderating and positive effect on the association between conservatism and CASH, (3) firm leverage, firm growth opportunity, and firm managerial ownership do not have a moderating effect on the last association. (4) Adopting EAS in 2016 by Egyptian listed firms gives the management of these firms' suitable chances to control CASH using its association with conservatism.

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