Univrsity Of Tehran Press Accounting and Auditing Review 2645-8020 16 3 2009 09 23 Accruals Quality and Corporate Cash Holdings Accruals Quality and Corporate Cash Holdings 20400 FA Hossein Fakhari Seyed Rohallah Taghavi Journal Article 1970 01 01 The consequences of good earnings quality to mitigate information asymmetry have been the subject of many empirical studies. However, evidence on implications of earnings quality on cash holdings is sparse. This Paper investigates the determinants of corporate cash holdings using panel data for firms listed in Tehran stock exchange from 2001 to 2007 to analyze the effect of financial reporting quality on cash holdings and uses accrual quality as a proxy of financial reporting quality. Our results suggest that cash holdings are negatively affected by financial reporting quality. This finding suggests firms with good accrual quality hold lower cash levels than firms with poor accrual quality. The results also show that cash holdings are positively affected by the growth opportunity, cash flows and liquid assets and negatively affected by size, debt maturity and opportunity cost. The consequences of good earnings quality to mitigate information asymmetry have been the subject of many empirical studies. However, evidence on implications of earnings quality on cash holdings is sparse. This Paper investigates the determinants of corporate cash holdings using panel data for firms listed in Tehran stock exchange from 2001 to 2007 to analyze the effect of financial reporting quality on cash holdings and uses accrual quality as a proxy of financial reporting quality. Our results suggest that cash holdings are negatively affected by financial reporting quality. This finding suggests firms with good accrual quality hold lower cash levels than firms with poor accrual quality. The results also show that cash holdings are positively affected by the growth opportunity, cash flows and liquid assets and negatively affected by size, debt maturity and opportunity cost. https://acctgrev.ut.ac.ir/article_20400_788741d4c2794095f9fe824a4389d635.pdf