Univrsity Of Tehran Press Accounting and Auditing Review 2645-8020 23 1 2016 03 20 The Study of the Accrual Earnings Management efffect on the relationship between Real Earnings Management and Cost of capital The Study of the Accrual Earnings Management efffect on the relationship between Real Earnings Management and Cost of capital 19 38 57018 10.22059/acctgrev.2016.57018 FA Yahya Kamyabi Head of accounting department Masome Shahsavari Rasol Salmani Journal Article 2015 01 08 This study investigates mediating role of accrual-based earnings management on the relationship between real earnings management (abnormal cash flow operating, abnormal production and abnormal discretionary expenses) and Cost of capital. We measured accrual-based earnings management through Kasznik Model and real earnings management by abnormal profits through cash flow, producing unusual and abnormal discretionary expenses. Using a combination of technical data for the 121 companies in Tehran Stock Exchange during the 5 year period 2009 to 2013, results of this study show that real earnings management is positively associated with cost of equity. In addition, findings show that real earnings management not only was directly related to cost of capital, but also indirectly associated with the cost of capital through an accrual earnings management. In other words, real earnings management causes rising accrual-based earnings management, and accrual-based earnings management will increase cost of capital. This study investigates mediating role of accrual-based earnings management on the relationship between real earnings management (abnormal cash flow operating, abnormal production and abnormal discretionary expenses) and Cost of capital. We measured accrual-based earnings management through Kasznik Model and real earnings management by abnormal profits through cash flow, producing unusual and abnormal discretionary expenses. Using a combination of technical data for the 121 companies in Tehran Stock Exchange during the 5 year period 2009 to 2013, results of this study show that real earnings management is positively associated with cost of equity. In addition, findings show that real earnings management not only was directly related to cost of capital, but also indirectly associated with the cost of capital through an accrual earnings management. In other words, real earnings management causes rising accrual-based earnings management, and accrual-based earnings management will increase cost of capital. https://acctgrev.ut.ac.ir/article_57018_fd4196472c00954c7b0014a0137753a6.pdf