Income Smoothing, Investor Reaction and Earnings Persistence
Journal Title: International Journal of Finance and Managerial Accounting - Year 2018, Vol 3, Issue 11
Abstract
The main objective of this study was to investigate the effect of income smoothing on investors reaction to Earnings Persistence of companies listed on the Stock Exchange in Tehran. The population of the study was companies listed on the Stock Exchange in Tehran, the sample size due to screening method and after removing outliers is equal to 118 companies. In this study, earnings persistence and income smoothing are considered as independent variables, and their impact on companies' reaction of investors is examined. In this study, the panel data is used with fixed and random effects, the results of the analysis of corporate data using multivariate regression at confidence level of 95% shows that the net income persistence and operating profit persistence have a direct impact on the reaction of investors. In addition, the results show that, income smoothing has a direct impact on relationship between investors and the net income persistence and operating profit.
Authors and Affiliations
Javad Mirzajani, Farzaneh Heidarpoor
Keywords
Related Articles
- EP ID EP534925
- DOI -
- Views 94
- Downloads 0
A Defined Benefit Pension Fund ALM Model through Multistage Stochastic Programming
We consider an asset-liability management (ALM) problem for a defined benefit pension fund (PF). The PF manager is assumed to follow a maximal fund valuation problem facing an extended set of risk factors: due to the lo...
A Compound Decision Support System for Corporate Planning
Providing a plan for any corporate or firm at macro level, as an organization or enterprise resource planning has particular importance nowadays. To meet the enterprise resource planning needs applications software packa...
Detecting Corporate Financial Fraud using Beneish M-Score Model
Detecting financial fraud is an important issue and ignoring this issue may cause financial and non-financial losses to individuals and organizations. The aim of this study is to test the ability of Beneish M-Score Model...
Investigating the Relationship between Religious Attitude and Perceptual Errors in Stock Exchange Investors
The perceptual error of the investors is one of the issues discussed in behavioral finance. The perceptual error is a wrong sensual or perceptual error. That is, what we see or hear does not match with the reality. Rega...
Internal Audit, Board of Directors and Financial Reporting Quality
High-quality internal audit is expected to lead to high-quality financial reporting. High-quality financial reporting expresses itself in earning quality. Earning quality has been playing a key role in capital market for...