The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation
<span style="font-size: small;"><span style="font-family: Times New Roman;">To create interests alignment between the owner and the manager, accurate index of performance should be usedas the rewarding criterion. One of the important indexes for performance measuremen...
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| Format: | Article |
| Language: | fas |
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University of Tehran
2017-12-01
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| Series: | تحقیقات مالی |
| Subjects: | |
| Online Access: | https://jfr.ut.ac.ir/article_66710_e938cf92fdca7289df5fa0f8a8f792a1.pdf |
| _version_ | 1811323909465702400 |
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| author | Sayed Ali Vaez Amir Hosein Montazer Hojat Rahim Bonabi Ghadim |
| author_facet | Sayed Ali Vaez Amir Hosein Montazer Hojat Rahim Bonabi Ghadim |
| author_sort | Sayed Ali Vaez |
| collection | DOAJ |
| description | <span style="font-size: small;"><span style="font-family: Times New Roman;">To create interests alignment between the owner and the manager, accurate index of performance should be usedas the rewarding criterion. One of the important indexes for performance measurement purposes in rewarding plans is the profit sensitivity, so that it can meet all of contract parties’ interests. Those profits carrying sensitivity cancause a change in the value of the company's market. So, the main purpose of this study is to survey the effect of profit sensitivity dimensions (Earnings response coefficient, abnormal returns fluctuations and earning prediction error)on board of directors’ reward. For this purpose, the data related to the Tehran Stock Exchange listed companies (121 companies) for the period from 2008 to 2016 were extracted and the multiple regression was used to test the hypothesis. The results showed that three criteria, namely, earnings response coefficient, adjusted earnings response coefficient and earnings value relevance, have a positive effect on board of director’s rewards, while two criteria, namely, abnormal returns fluctuations and earning prediction error have a negative effect on board of director’s rewards.</span></span> |
| first_indexed | 2024-04-13T14:04:53Z |
| format | Article |
| id | doaj.art-e760ea711ae7403f807c0ada1cc24470 |
| institution | Directory Open Access Journal |
| issn | 1024-8153 2423-5377 |
| language | fas |
| last_indexed | 2024-04-13T14:04:53Z |
| publishDate | 2017-12-01 |
| publisher | University of Tehran |
| record_format | Article |
| series | تحقیقات مالی |
| spelling | doaj.art-e760ea711ae7403f807c0ada1cc244702022-12-22T02:43:57ZfasUniversity of Tehranتحقیقات مالی1024-81532423-53772017-12-0119461564210.22059/jfr.2018.249698.100658066710The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s CompensationSayed Ali Vaez0Amir Hosein Montazer Hojat1Rahim Bonabi Ghadim2Assistant Prof. in Accounting, Shahid Chamran University, Ahvaz, IranAssistant Prof in Economics and Applied Econometrics, Shahid Chamran University, Ahvaz, IranPhD. in Accounting, Hashtrood Branch, Islamic Azad University, Hashtrood, Iran<span style="font-size: small;"><span style="font-family: Times New Roman;">To create interests alignment between the owner and the manager, accurate index of performance should be usedas the rewarding criterion. One of the important indexes for performance measurement purposes in rewarding plans is the profit sensitivity, so that it can meet all of contract parties’ interests. Those profits carrying sensitivity cancause a change in the value of the company's market. So, the main purpose of this study is to survey the effect of profit sensitivity dimensions (Earnings response coefficient, abnormal returns fluctuations and earning prediction error)on board of directors’ reward. For this purpose, the data related to the Tehran Stock Exchange listed companies (121 companies) for the period from 2008 to 2016 were extracted and the multiple regression was used to test the hypothesis. The results showed that three criteria, namely, earnings response coefficient, adjusted earnings response coefficient and earnings value relevance, have a positive effect on board of director’s rewards, while two criteria, namely, abnormal returns fluctuations and earning prediction error have a negative effect on board of director’s rewards.</span></span>https://jfr.ut.ac.ir/article_66710_e938cf92fdca7289df5fa0f8a8f792a1.pdfabnormal returns fluctuationboard of director’s rewardearning prediction errorearnings response coefficientprofit sensitivity |
| spellingShingle | Sayed Ali Vaez Amir Hosein Montazer Hojat Rahim Bonabi Ghadim The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation تحقیقات مالی abnormal returns fluctuation board of director’s reward earning prediction error earnings response coefficient profit sensitivity |
| title | The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation |
| title_full | The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation |
| title_fullStr | The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation |
| title_full_unstemmed | The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation |
| title_short | The Effect of Profit Sensitivity Dimensions (Earnings Response Coefficient, Returns Abnormal Fluctuations and Earning Prediction Error) on Board of Director’s Compensation |
| title_sort | effect of profit sensitivity dimensions earnings response coefficient returns abnormal fluctuations and earning prediction error on board of director s compensation |
| topic | abnormal returns fluctuation board of director’s reward earning prediction error earnings response coefficient profit sensitivity |
| url | https://jfr.ut.ac.ir/article_66710_e938cf92fdca7289df5fa0f8a8f792a1.pdf |
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