The Study of the Incremental Predictive Ability of Accruals With Respect to Future Cash Flows by MohammadHossein Vadiei, Ph.D, Mahdi Fakhrian

“…Though the cash flow statement presents some data on the business cash flows during the reported financial year, the mentioned data are not enough to predict the future cash flows.We examine 149 companies’ security & exchange commission of Tehran from 1377 until 1385.Results of this research shows that: 1) Cash flow forecast information incorporating accrual information outperforms incorporating only cash flow information. 2) The incremental predictive ability of the accrual information decreasing in the volatility of ending inventory. 3) The incremental predictive ability of the accrual information over cash flow only information will very in the volatility of sales. 4) The incremental predictive ability of the accrual information over cash flow only information volatility of firm size.…”
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