Earning Management and General, Sale and Administration Expenses Stickiness

Document Type : Original Article

Authors

1 Assistant of Professor of Accounting, University of Allameh Tabatabai, Tehran, Iran

2 Ph.D. Student of Accounting, University of Allameh Tabatabai, Tehran, Iran

3 M.A. in Accounting, Islamic Azad University, Semnan Branch, Semnan, Iran

Abstract

In this study, the relationship between administrative, general and sale expenses (SGA) stickiness and earnings management in listed companies in Tehran Stock Exchange has been investigated. Our sample was a group of 120 companies listed between 1390 and 1394. To analyze the data and test and hypotheses, multivariate regression model was used. Results show that the motive for upside earning management is not related to SGA expenses stickiness. These results are contrary to the results of Xue and Hong (2015), Hashemi & Nejati (1394) and Mansourfar et al (1396). But as we separated the items of SGA expenses, we found a direct relation between the motive for upside earning management and stickiness of research and development expense. Our results of correspond to Banker et al (2011) and Co et al (2015) studies. Also, we found no relation between earning management and other SGA expenses stickiness, contrary to the result of Banker et al (2011) and Co et al (2015) studies.

Keywords

Journal of Iranian Accounting Review
Volume 4, Issue 16
September 2017
Pages 111-132

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