This research examines the relationship between conservative financial reporting and management earnings forecasts. In this study, data from 76 firms listed in the Tehran Stock Exchange from 2005 to 2011 has been collected and the research hypothesis has been tested by utilizing the regression coefficient analysis. Conservatism was measured using the Gioly and Hayn model (2000), Basu model (1997) and Market-t- Book (MTB) standard and the effects of conservatism on management earnings forecast was measured. The results show that conservatism has a significant and negative relationship on the number and frequency of earnings predictions by managers; i.e. the greater the degree of conservatism is among managers, the less willing the managers are to disclose and reveal their forecasts. However, no relationship was observed between conservatism and the accuracy of predictions. The results also show that there is a significant and negative relationship between conservatism and predicting validity. In other words, as conservatism level increases, the earnings prediction error by managers decreases.
Asadi, G. H., & Bayat, M. (2014). The Impact of Conservatism on Management Earnings Forecasts. Accounting and Auditing Review, 21(1), 19-38. doi: 10.22059/acctgrev.2014.50781
MLA
Gholam Hossein Asadi; Morteza Bayat. "The Impact of Conservatism on Management Earnings Forecasts". Accounting and Auditing Review, 21, 1, 2014, 19-38. doi: 10.22059/acctgrev.2014.50781
HARVARD
Asadi, G. H., Bayat, M. (2014). 'The Impact of Conservatism on Management Earnings Forecasts', Accounting and Auditing Review, 21(1), pp. 19-38. doi: 10.22059/acctgrev.2014.50781
VANCOUVER
Asadi, G. H., Bayat, M. The Impact of Conservatism on Management Earnings Forecasts. Accounting and Auditing Review, 2014; 21(1): 19-38. doi: 10.22059/acctgrev.2014.50781
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