Shahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720111106Impact of Firm’s Scope of Operation on the Board of Director’s Structure (Evidence from Tehran Stock Exchange)Impact of Firm’s Scope of Operation on the Board of Director’s Structure (Evidence from Tehran Stock Exchange)7251010.22103/jak.2011.10FAMohammadNamaziMohammadMonfared MaharlouieJournal Article20110208By separating management from ownership, and the emergence of the agency theory, the board of directors has been identified as one of the mechanisms of implementing internal controls and governing firms. Thus, the present study, in an attempt to provide a contemporary view towards the importance, quality and quantity of the boards of directors, investigates the impact of the scope of operations of the firm on the board of director’s structure. The sample consisted of 60 firms listed in the Tehran Stock Exchange (TSE) from 2000 to 2009. The statistical method of analysis utilizes the Logistic Regression Model and Ordinary Least Square Regression Model for Panel Data. The findings revealed that the scope of operation measures, namely firm size, firm age and debt ratios, didn’t significantly affect the board of director’s structure measures, including board of director’s size, the percentage of outsiders in the board of directors, the appointment of the outsider director as a chairman, and the presence of at least 3 outsiders in the board of directors. However, the ownership percentage of institutional shareholders had a significant and negative effect on the board of director’s structure. The type of industry, however, didn’t have a significant impact on the board of director’s structure in investigating firms.By separating management from ownership, and the emergence of the agency theory, the board of directors has been identified as one of the mechanisms of implementing internal controls and governing firms. Thus, the present study, in an attempt to provide a contemporary view towards the importance, quality and quantity of the boards of directors, investigates the impact of the scope of operations of the firm on the board of director’s structure. The sample consisted of 60 firms listed in the Tehran Stock Exchange (TSE) from 2000 to 2009. The statistical method of analysis utilizes the Logistic Regression Model and Ordinary Least Square Regression Model for Panel Data. The findings revealed that the scope of operation measures, namely firm size, firm age and debt ratios, didn’t significantly affect the board of director’s structure measures, including board of director’s size, the percentage of outsiders in the board of directors, the appointment of the outsider director as a chairman, and the presence of at least 3 outsiders in the board of directors. However, the ownership percentage of institutional shareholders had a significant and negative effect on the board of director’s structure. The type of industry, however, didn’t have a significant impact on the board of director’s structure in investigating firms.https://jak.uk.ac.ir/article_10_d3d9446802a44259755d38e6d163e820.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720110921Inflation and Nominal Financial Reporting: Implications for Performance and Stock PricesInflation and Nominal Financial Reporting: Implications for Performance and Stock Prices27461110.22103/jak.2011.11FAVidaMojtahed ZadehDornazNeitasJournal Article20110412This study investigates nominal financial reporting and its implications for firm's performance and stock prices under inflationary condition. To do so, the correlation between unrecognized inflation gains or losses as independent variable and future operating cash flows, future cash flows from sale of assets and abnormal returns on portfolios constructed on unrecognized inflation gains or losses as dependent variables was examined. Independent variable was calculated by inflation adjustment algorithm (Konchitchki, 2009). To investigate the relationship between independent and dependent variables Barth, Cram, and Nelson (2001), Konchitchki (2009), and Fama and French (1993) models were used. Pearson statistical analysis was applied to test the hypotheses. Using data for 98 listed companies on Tehran Stock Exchange from March 2000 to February 2009, the results shows the higher unrecognized inflation gains or losses of a firm, the lower future operating cash flows is expected. Moreover, such firms tend to sell their fix assets and have lower stock returns in future.This study investigates nominal financial reporting and its implications for firm's performance and stock prices under inflationary condition. To do so, the correlation between unrecognized inflation gains or losses as independent variable and future operating cash flows, future cash flows from sale of assets and abnormal returns on portfolios constructed on unrecognized inflation gains or losses as dependent variables was examined. Independent variable was calculated by inflation adjustment algorithm (Konchitchki, 2009). To investigate the relationship between independent and dependent variables Barth, Cram, and Nelson (2001), Konchitchki (2009), and Fama and French (1993) models were used. Pearson statistical analysis was applied to test the hypotheses. Using data for 98 listed companies on Tehran Stock Exchange from March 2000 to February 2009, the results shows the higher unrecognized inflation gains or losses of a firm, the lower future operating cash flows is expected. Moreover, such firms tend to sell their fix assets and have lower stock returns in future.https://jak.uk.ac.ir/article_11_6512bd43d9caa6e02c990b0a82652dca.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720110921The Effect of Conditional Conservatism on Cost of Equity CapitalThe Effect of Conditional Conservatism on Cost of Equity Capital47671210.22103/jak.2011.12FASeyed AbbasHashemiShekoofehFarahmandNaserShamirzaei JeshvaghaniJournal Article20110305This study investigates the relationship between conditional conservatism and the cost of equity capital. In this study conditional conservatism rate is measured based on Callen et al (2009) at firm-year level and the three Fama and French (1993) factor model is used to investigate the impact of conditional conservatism on the cost of equity capital at firm and portfolio level. The sample consists of 82 firms that are publicly traded in the Tehran Stock Exchange (TSE) over the period 2001-2009. A multi variable regression model has been used for testing of hypotheses in cross sectional and time series forms. Obtained results show that there is a negative relationship between conditional conservatism and the cost of equity capital and higher degree of conditional conservatism decreases firm’s cost of equity capital. Also, there is a positive relationship between conditional conservatism and portfolio’s cost of capital. This relationship is statistically significant in the case of middle conservatism portfolio and high conservatism portfolio. However, this is insignificant in case of low conservatism portfolio.This study investigates the relationship between conditional conservatism and the cost of equity capital. In this study conditional conservatism rate is measured based on Callen et al (2009) at firm-year level and the three Fama and French (1993) factor model is used to investigate the impact of conditional conservatism on the cost of equity capital at firm and portfolio level. The sample consists of 82 firms that are publicly traded in the Tehran Stock Exchange (TSE) over the period 2001-2009. A multi variable regression model has been used for testing of hypotheses in cross sectional and time series forms. Obtained results show that there is a negative relationship between conditional conservatism and the cost of equity capital and higher degree of conditional conservatism decreases firm’s cost of equity capital. Also, there is a positive relationship between conditional conservatism and portfolio’s cost of capital. This relationship is statistically significant in the case of middle conservatism portfolio and high conservatism portfolio. However, this is insignificant in case of low conservatism portfolio.https://jak.uk.ac.ir/article_12_c20ad4d76fe97759aa27a0c99bff6710.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720111221Explaining the Relationship between Corporate Governance and Earnings Quality in IranExplaining the Relationship between Corporate Governance and Earnings Quality in Iran69981310.22103/jak.2011.13FAKavehMehraniMohammad HoseinSafarzadehJournal Article20110723Using panel data analysis, this paper examines the relationship between corporate governance and quality of reported earnings. The sample is comprised of 117 listed in Tehran Stock Exchange (TSE) during the period of 1386-1388. Prior research has used many surrogates for corporate governance. However, the criticism of the extant research has been that corporate governance comprises many facets and is not uni-dimensional. Quality of earnings is measured in seven ways. Empirical tests demonstrate that the overall governance measure is 1) negatively related to the accrual quality, earnings persistence, earnings management and conservatism, 2) positively related to the earnings predictability and earnings timeliness, and 3) not related to the value relevance. In other words, the results suggest that there are multiple dimensions to the relationship between earnings quality and corporate governance that preclude supporting the spirit of either the monitoring or the assurance hypotheses. Furthermore, our results suggest that disaggregating corporate governance measure into more components cause to decreasing in explanatory power of the models. Finally, the relationship between corporate governance and various measures of earnings quality in different industries is not homogenous.Using panel data analysis, this paper examines the relationship between corporate governance and quality of reported earnings. The sample is comprised of 117 listed in Tehran Stock Exchange (TSE) during the period of 1386-1388. Prior research has used many surrogates for corporate governance. However, the criticism of the extant research has been that corporate governance comprises many facets and is not uni-dimensional. Quality of earnings is measured in seven ways. Empirical tests demonstrate that the overall governance measure is 1) negatively related to the accrual quality, earnings persistence, earnings management and conservatism, 2) positively related to the earnings predictability and earnings timeliness, and 3) not related to the value relevance. In other words, the results suggest that there are multiple dimensions to the relationship between earnings quality and corporate governance that preclude supporting the spirit of either the monitoring or the assurance hypotheses. Furthermore, our results suggest that disaggregating corporate governance measure into more components cause to decreasing in explanatory power of the models. Finally, the relationship between corporate governance and various measures of earnings quality in different industries is not homogenous.https://jak.uk.ac.ir/article_13_c51ce410c124a10e0db5e4b97fc2af39.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720110921Effect of Firms' Acquisition Strategy on Earnings ManagementEffect of Firms' Acquisition Strategy on Earnings Management991201410.22103/jak.2011.14FAGhasemBlue0000-0002-6984-6368AkramAnabestaniJournal Article20110115This study examines whether target firms manage their earnings upward in the period leading to their acquisition or not, using data on a sample of 46 firms listed in Tehran Stock Exchange for the period 1382-87. In this study, discretionary accruals were used as the proxy for earnings management, and we utilized the modified Jones model under balance sheet and cash flow approaches with some modifications to the balance sheet approach. The results show that there was no significant difference between discretionary accruals of target firms for the periods before and after acquisition, nor between discretionary accruals of target firms in the period before acquisition and those of firms in control group.This study examines whether target firms manage their earnings upward in the period leading to their acquisition or not, using data on a sample of 46 firms listed in Tehran Stock Exchange for the period 1382-87. In this study, discretionary accruals were used as the proxy for earnings management, and we utilized the modified Jones model under balance sheet and cash flow approaches with some modifications to the balance sheet approach. The results show that there was no significant difference between discretionary accruals of target firms for the periods before and after acquisition, nor between discretionary accruals of target firms in the period before acquisition and those of firms in control group.https://jak.uk.ac.ir/article_14_aab3238922bcc25a6f606eb525ffdc56.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720111221An Investigation of the Predict Ability and Information Content of Incom Statement Components.An Investigation of the Predict Ability and Information Content of Incom Statement Components.1211421510.22103/jak.2011.15FAOmidPourheidari0000-0003-1599-4434SomayehYazdieJournal Article20110220The main purpose of this study is to evaluate the ability of components of income statement in predicting of net earnings and stock returns. To achieve this objective change in annual net earnings separated to changes in reported sales, gross profit and other expenses and the predict ability and explanatory power of overall net income model were compared with net income separate models. This study selected 51 companies listed in Tehran Stock Exchange in the period 1387-1383 was conducted. The results show that in prediction of future earnings and stock returns explain the change in sales, gross profit and other costs, have higher predict ability and information content than the net earnings. Changes in sales and gross profit have higher ability to predict and information content than operating profits. Also, changes in operating income have higher information content and the ability to predict than net income. According to the results is concluded that the separation of earnings components increased predict ability and information content of earnings.The main purpose of this study is to evaluate the ability of components of income statement in predicting of net earnings and stock returns. To achieve this objective change in annual net earnings separated to changes in reported sales, gross profit and other expenses and the predict ability and explanatory power of overall net income model were compared with net income separate models. This study selected 51 companies listed in Tehran Stock Exchange in the period 1387-1383 was conducted. The results show that in prediction of future earnings and stock returns explain the change in sales, gross profit and other costs, have higher predict ability and information content than the net earnings. Changes in sales and gross profit have higher ability to predict and information content than operating profits. Also, changes in operating income have higher information content and the ability to predict than net income. According to the results is concluded that the separation of earnings components increased predict ability and information content of earnings.https://jak.uk.ac.ir/article_15_9bf31c7ff062936a96d3c8bd1f8f2ff3.pdfShahid Bahonar University of KermanJournal of Accounting Knowledge2008-89142720111106Efficiency of the Feltham-Ohlson (1995) Model in Tehran Stock ExchangeEfficiency of the Feltham-Ohlson (1995) Model in Tehran Stock Exchange1411601610.22103/jak.2011.16FAFarzanehNassirzadeh0000-0002-5876-6389FarhadKarimipourJournal Article20100819This study seeks to examine efficiency of Feltham- Ohlsen (1995) valuation model in the Tehran Stock Exchange and is trying to identify relation between intrinsic company value and return. This model is trying to determine the intrinsic value of company using their book value. Statistical community of this study includes all TSE accepted companies and statistical sample is including 89 TSE accepted companies from different industry and data for these firms are analyzed interval 1998 to 2009 using Time series-Cross sectional (panel data) regression model. Results show that the model above boldly dose' not able to determine the intrinsic value of companies. The relationship between intrinsic value to market value ratio and price to earning value ratio is not statistically significant. In addition, companies that have little intrinsic value to market value ratios are higher than the market are assessed.This study seeks to examine efficiency of Feltham- Ohlsen (1995) valuation model in the Tehran Stock Exchange and is trying to identify relation between intrinsic company value and return. This model is trying to determine the intrinsic value of company using their book value. Statistical community of this study includes all TSE accepted companies and statistical sample is including 89 TSE accepted companies from different industry and data for these firms are analyzed interval 1998 to 2009 using Time series-Cross sectional (panel data) regression model. Results show that the model above boldly dose' not able to determine the intrinsic value of companies. The relationship between intrinsic value to market value ratio and price to earning value ratio is not statistically significant. In addition, companies that have little intrinsic value to market value ratios are higher than the market are assessed.https://jak.uk.ac.ir/article_16_c74d97b01eae257e44aa9d5bade97baf.pdf