Relationship between Related Party Transactions and Earnings Management | ||
| بررسیهای حسابداری و حسابرسی | ||
| Article 6, Volume 20, Issue 4, March 2014, Pages 77-92 PDF (321.01 K) | ||
| Document Type: Research Paper | ||
| DOI: 10.22059/acctgrev.2014.36590 | ||
| Authors | ||
| Narges Sarlak1; Mina Akbari* 2 | ||
| 1Assistant Prof., Faculty of Management, University of Qom, Iran | ||
| 2M.Sc. of Accounting, University of Qom, Iran | ||
| Abstract | ||
| This study uses data from companies listed on the Tehran Stock Exchange to investigate whether related party transactions are associated with earnings management. According to the agency theory because of the separation of ownership from control, conflict of interest may arise, so if a firm`s executives and/or board members engage in related party transactions to expropriate the firm`s resources, then they have incentives to manage earnings to mask such expropriation. The research uses the related party transactions as the independent variable and discretionary accruals as the dependent variable. The sample of study includes 145 companies from 2008 to 2012. The panel data and multiple linear regressions are used to examine the hypothesis. The results of this study reveal that there is a significant positive relationship between the related party transactions and earnings management. | ||
| Keywords | ||
| Discretionary accruals; Earning management; Related Party Transactions | ||
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