The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns
Objective: The purpose of this research is to investigate the relationship between Firm-Specific Discretionary Accruals andStock Future Abnormal Returns on Tehran Stock Exchange. Methods: This studycarries out according to the information available in listed Companies in the Tehran Stock Exchange (T...
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| Format: | Article |
| Language: | fas |
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University of Tehran
2019-04-01
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| Series: | بررسیهای حسابداری و حسابرسی |
| Subjects: | |
| Online Access: | https://acctgrev.ut.ac.ir/article_71155_316b792328296fc04b695e28851c0899.pdf |
| _version_ | 1819033414275170304 |
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| author | Mohammad Hossein Vadiee Noghbi Mohammad Hossain Saei |
| author_facet | Mohammad Hossein Vadiee Noghbi Mohammad Hossain Saei |
| author_sort | Mohammad Hossein Vadiee Noghbi |
| collection | DOAJ |
| description | Objective: The purpose of this research is to investigate the relationship between Firm-Specific Discretionary Accruals andStock Future Abnormal Returns on Tehran Stock Exchange. Methods: This studycarries out according to the information available in listed Companies in the Tehran Stock Exchange (TSE), during 2011 to 2016, on a selected sample consisting of 190 companies. To test the research hypothesis, OLS regression has) been used. Results: The results show that there is a negative and significant relationship between Firm-Specific Discretionary Accruals andStock Future Abnormal Returns. Conclusion: Investors should distinguish between the stability of profit components (cash and accrual) when valuing companies. The disregard of this difference has made investors optimistic about the future performance of companies when the Firm-Specific Discretionary Accruals is high, and pessimistic about the future of companies when Firm-Specific Discretionary Accruals is low. Therefore, if such unskilled investors were affected on stock price, we would expect high prices for companies with high Firm-Specific Discretionary Accruals and low prices for companies with low Firm-Specific Discretionary Accruals. In fact, companies are valued incorrectly and irrationally and since the stability of Firm-Specific Discretionary Accruals is low, in future periods, they will receive less than expected returns (negative abnormal returns) and companies with low Firm-Specific Discretionary Accruals will earn more than expected returns (positive abnormal returns). |
| first_indexed | 2024-12-21T07:17:27Z |
| format | Article |
| id | doaj.art-31e9408513844463b880c113e301e94d |
| institution | Directory Open Access Journal |
| issn | 2645-8020 2645-8039 |
| language | fas |
| last_indexed | 2024-12-21T07:17:27Z |
| publishDate | 2019-04-01 |
| publisher | University of Tehran |
| record_format | Article |
| series | بررسیهای حسابداری و حسابرسی |
| spelling | doaj.art-31e9408513844463b880c113e301e94d2022-12-21T19:11:51ZfasUniversity of Tehranبررسیهای حسابداری و حسابرسی2645-80202645-80392019-04-0126115116810.22059/acctgrev.2019.268717.100803471155The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal ReturnsMohammad Hossein Vadiee Noghbi0Mohammad Hossain Saei1Associate Prof., Department of Accounting, Faculty of Economic and Administrative Science, Ferdowsi University of Mashhad, Mashhad, IranM.Sc., Department of Accounting, Faculty of Economic and Administrative Science, Ferdowsi University of Mashhad, Mashhad, IranObjective: The purpose of this research is to investigate the relationship between Firm-Specific Discretionary Accruals andStock Future Abnormal Returns on Tehran Stock Exchange. Methods: This studycarries out according to the information available in listed Companies in the Tehran Stock Exchange (TSE), during 2011 to 2016, on a selected sample consisting of 190 companies. To test the research hypothesis, OLS regression has) been used. Results: The results show that there is a negative and significant relationship between Firm-Specific Discretionary Accruals andStock Future Abnormal Returns. Conclusion: Investors should distinguish between the stability of profit components (cash and accrual) when valuing companies. The disregard of this difference has made investors optimistic about the future performance of companies when the Firm-Specific Discretionary Accruals is high, and pessimistic about the future of companies when Firm-Specific Discretionary Accruals is low. Therefore, if such unskilled investors were affected on stock price, we would expect high prices for companies with high Firm-Specific Discretionary Accruals and low prices for companies with low Firm-Specific Discretionary Accruals. In fact, companies are valued incorrectly and irrationally and since the stability of Firm-Specific Discretionary Accruals is low, in future periods, they will receive less than expected returns (negative abnormal returns) and companies with low Firm-Specific Discretionary Accruals will earn more than expected returns (positive abnormal returns).https://acctgrev.ut.ac.ir/article_71155_316b792328296fc04b695e28851c0899.pdfFirm-specific discretionary accrualsIndustry-specific discretionary accrualsEarning managementStock future abnormal returns |
| spellingShingle | Mohammad Hossein Vadiee Noghbi Mohammad Hossain Saei The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns بررسیهای حسابداری و حسابرسی Firm-specific discretionary accruals Industry-specific discretionary accruals Earning management Stock future abnormal returns |
| title | The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns |
| title_full | The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns |
| title_fullStr | The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns |
| title_full_unstemmed | The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns |
| title_short | The Relationship between Firm-Specific Discretionary Accruals and Stock Future Abnormal Returns |
| title_sort | relationship between firm specific discretionary accruals and stock future abnormal returns |
| topic | Firm-specific discretionary accruals Industry-specific discretionary accruals Earning management Stock future abnormal returns |
| url | https://acctgrev.ut.ac.ir/article_71155_316b792328296fc04b695e28851c0899.pdf |
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