Surveying Effect of Reporting Conservatism Levels on the Information Content of Earnings in Tehran Stock Exchange

Abstract

The purpose of this study, the effect of financial reporting conservatism levels on the information content of earnings and explain their impact on stock prices of companies in Tehran Stock Exchange is accepted. Conservative measure of the model Givoly and hayne(2000) and information content of accounting profit of two Olson (1995) and Collins(1994) model has been used. The statistical population of companies in Tehran Stock Exchange is accepted. Using the systematic elimination of 90 companies during the period ‌ 2005 to 2009 has been selected. The research to test the hypothesis of multivariate linear regression and non-parametric test Kruskal - Wallis was used. The use of conservative approaches to explain and interpret the stock price does not affect accounting earnings. The first hypothesis test results financial reporting conservatism levels are affecting on information contant of accounting earnings. The level of conservatism in Iran country financial reports investor's ability to predict future earnings based on current income may affect. The second hypothesis test results indicate Reporting Conservatism levels are no effect on stock prices of companies.