Earnings Management and Initial Public Offerings (IPOs) at Tehran Stock Exchange (TSE)

Abstract

This paper attempted to examine the earnings management in the initial public offerings of corporate shares at Tehran Stock Exchange (TSE). Using a sample 47 companies listed on Tehran Stock Exchange during 2000 to 2009, this research analyzes the model for discretionary current accruals. The results showed managers manipulated the corporate earnings through the discretionary current accruals three years before admission to the Stock Exchange manage. Additionally, the results revealed that managers tended to manipulate the earnings during the year prior to the public offerings though the discretionary current accruals, even though there was no evidence suggesting that managers manipulated the earnings at the IPO year.

DOI: 10.5901/mjss.2015.v6n6s6p92