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An Investigation of the Effect of Audit Quality on Accrual Reliability of Listed Companies on Tehran Stock Exchange

Author

Listed:
  • Mahdi SALEHI

    (Accounting and Management Department, Guilan University, Iran)

  • Saeid Jabarzadeh KANGARLOUEI

    (Islamic Azad University, Orumieh Branch, Iran)

Abstract

This study investigates the effect of audit quality on accrual reliability of listed companies on Tehran Stock Exchange. In order to determine audit quality has been used of two criteria of auditor level and auditor commission period and due to calculate accrual reliability in following of Richardson et al., (2005) model and of stability of accrual. The study covers 74 listed companies on Tehran Stock Exchange during 2005-2009 periods. Also, multiple linear regression models and data investigation method have been used sectional and annual investigation to test research hypotheses. Research findings indicate that audited firms with higher audit quality as compared by audited firms with lower quality have more accrual stability coefficient and finally, they have more accrual reliability.

Suggested Citation

  • Mahdi SALEHI & Saeid Jabarzadeh KANGARLOUEI, 2010. "An Investigation of the Effect of Audit Quality on Accrual Reliability of Listed Companies on Tehran Stock Exchange," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 11(5), pages 940-960, December.
    • Handle: RePEc:rom:rmcimn:v:11:y:2010:i:5:p:940-960
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    File URL: https://www.rmci.ase.ro/no11vol5/15.pdf
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    References listed on IDEAS

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    1. Richardson, Scott A. & Sloan, Richard G. & Soliman, Mark T. & Tuna, Irem, 2005. "Accrual reliability, earnings persistence and stock prices," Journal of Accounting and Economics, Elsevier, vol. 39(3), pages 437-485, September.
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    Cited by:

    1. Loveday A. Nwanyanwu, 2017. "Audit Quality Practices and Financial Reporting in Nigeria," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 7(2), pages 145-155, April.
    2. Ashkan Mirzay Fashami & Pran Krishansing Boolaky & Kamil Omoteso, 2020. "Threats to Auditor Independence: Evidence from Iran," Athens Journal of Business & Economics, Athens Institute for Education and Research (ATINER), vol. 6(4), pages 253-302, October.

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    More about this item

    Keywords

    audit quality; auditor size; auditor tenure; accrual reliability.;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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