Incentives Affecting Earnings Management

Authors

1 Associate Professor of Accounting, Allameh Tabatabaee University, Tehran, Iran.

2 Assistant Professorof Accounting, Shahid Bahonar university of Kerman, Kerman, Iran.

Abstract

      This research attempt to identify the factors influencing managers to manipulate earnings in Tehran Stock Exchange companies. In order to achive this goal, 40 firms in a period of 11years(1372- 1382)were chosen. Based on theoretical investigation under Irans' economic, social and cultural environment, seven factors as independent that affect managers' insentives to manipulate earnings were selected. Discretionary accruals a suitable substitute for earnings management measurement is measured as the dependent variable.  The results show that on the average, there has been a positive relation between debt to equity ratio and quality of auditors work with earnings management. In addition, there has been a negative relation between ownership stracture, bonus, and size with earnings management. Furthermore, growth ratio and initial public offering have not been related significantly in Iranian companies.

Keywords


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