Under conditions that two-digit inflation rate in Iran creates ambiguity regarding the utility of financial reports that are not adjusted for inflation, income manipulation and smoothing can add more questions about the usefulness of such reports. In this research, income smoothing in listed companies in Tehran Stock Exchange utilizing Iranian Accounting Standard Number 15 (accounting for investments) was investigated. This standard which authorizes use of "market" or "lower of cost or net sales price" for investing in trading securities logically seems like a tool for income smoothing and income manipulation.
Performed statistical tests on listed companies in Tehran Stock Exchange for the years 1380 to 1382 indicates that although these tools have not been used extensively, but income smoothing is observed in companies that had non-zero gains resulting from sale of their investments.