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Reviewing Conservative Relationship between Accounting and Corporate Governance Mechanisms

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  • Hashem Valipour
  • Mostafa Sohouli Vahed

Abstract

This research has the aim of reviewing relationship between some corporate governance mechanisms and conservatism in financial reports. Conservatism is potentially useful for corporate governance in some ways- first it reduce opportunistic engagement of management against itself. Second, it results in management report about loss from selling assets and ceases operation and finally it prevents continuity of management investment in projects with negative net present value. Estimated coefficient of independent variable of ownership concentration is positive and their p-value is less than 5%, so it can be said that there is a positive and significant relationship between ownership concentration and conservative accounting and the first sub-hypothesis is accepted. Estimated coefficient of independent variable of BD (Board of directors) size is positive and its p-value is higher than 5%, so it can be said that there is no significant relationship between BD size and conservative accounting then the second sub-hypothesis is rejected. Estimated coefficient of independent variable of BD composition is positive and its p-value is less than 5%, so it can be said that there is a positive and significant relationship between BD composition and conservative accounting then the third sub-hypothesis is accepted. Estimated coefficient of independent variable of shareholder directors is negative and its p-value is higher than 5%, so it can be said that there is no significant relationship between shareholder directors and conservative accounting then the forth sub-hypothesis is rejected.

Suggested Citation

  • Hashem Valipour & Mostafa Sohouli Vahed, 2017. "Reviewing Conservative Relationship between Accounting and Corporate Governance Mechanisms," International Journal of Business and Management, Canadian Center of Science and Education, vol. 12(6), pages 172-172, May.
    • Handle: RePEc:ibn:ijbmjn:v:12:y:2017:i:6:p:172
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    References listed on IDEAS

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    2. Ahmad Bello Author_Email:, 2011. "Corporate Governance And Accounting Ethics In Nigeria," International Conference on Management (ICM 2011) Proceeding 2011-110-187, Conference Master Resources.
    3. Chi, Wuchun & Liu, Chiawen & Wang, Taychang, 2009. "What affects accounting conservatism: A corporate governance perspective," Journal of Contemporary Accounting and Economics, Elsevier, vol. 5(1), pages 47-59.
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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