The aim of this study was to investigate the effects of growth opportunities and dividend policy on the quality of financial reporting in Iran's capital market. The period in the study is 6-year (from 2006 till 2011) and the population is all listed companies in Tehran Stock Exchange. The sample was also obtained by screening methods, includes 84 companies. The results of the test research hypotheses using panel data suggest that in capital market of listed companies the quality of financial reporting in Iran had a direct relationship with the dividend policy. It means that increasing in dividend policy lead to increases in amount of financial reporting quality effect. Also obtained results indicate that growth opportunities have a direct impact on the quality of financial reporting. So that firms with higher growth opportunities will increase effectiveness and financial reporting quality.

This study aims to evaluate the effect of two major drivers including: bad company and also the lower benefit from the profits over the previous year on earnings management process of active companies in the capital markets in Iran. Research time period is 6-year (from 2006 till 2011) and the population is all the listed companies in Tehran Stock Exchange. The sample was obtained by screening method includes 199 company. The results of hypotheses testing using panel data showed the probability of using of discretionary accruals in order to show profitable enterprise increases, when the company has loss before using earning management in Iranian market capital. The results also indicate that when the current company's profit is lower than the previous year's profit, the possibility of using the discretionary accruals increases to show positive changes in profitability. Thus, it can be announced that bad and also lower benefit from last year, are as two major driving of earnings management.Keywords: earning management, profit before applying earnings management, discretionary accruals. ISSN 2162-3082 2014 www.macrothink.org/ijafr 24 International Journal of Accounting and Financial Reporting IntroductionAccounting earnings consist of cash and accrual item and accruals are largely in control by management. Often, investors and executives believe companies that have good profitability trends and their benefits have no major changes, have more value and more predictability in compare with similar company. Also, according to agency theory, managers can also have the incentive to manipulate earnings to maximize their interests. This study attempted to examine the influence of both major drivers of earning management including: being bad company and also have lower benefit from previous year, in active Iranian market. Problem StatementStudies have shown that low volatility and stabilize profit, are indicative of its quality. Therefore, investors with more sure invest in the stock of the companies that their profit process is more stable. Earnings management is defined as public involvement management in process of determining profits that is in line with the desired objectives of management (Wild et al, 2001, p238).Corporate earnings management behavior has been studied and it has been linked with a measure of profitability includes profit and increase profits (Bourg AstalrandDichew,1997, p 106). They have concluded that lack of continue in profits to near zero and near-zero changes in earnings leads to managers manipulate they Earnings to report its Earnings or maintain previous year profits.Despite several studies that have been done in relation to earnings management, still whether or not to achieve the criteria by earnings manipulating are at least two reasons that remain unsolved. First, the claim that the presence of causal link between earnings management and profit criteria is based on reported earnings. Second, although the earnings discontinuity is visible, but regardless of the managerial manipulat...

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This study investigates empirically whether the degree of stock market efficiency is related to the prediction power of future price change using the indices of twenty seven stock markets. Efficiency refers to weak-form efficient market hypothesis (EMH) in terms of the information of past price changes. The prediction power corresponds to the hit-rate, which is the rate of the consistency between the direction of actual price change and that of predicted one, calculated by the nearest neighbor prediction method (NN method) using the out-of-sample. In this manuscript, the Hurst exponent and the approximate entropy (ApEn) are used as the quantitative measurements of the degree of efficiency. The relationship between the Hurst exponent, reflecting the various time correlation property, and the ApEn value, reflecting the randomness in the time series, shows negative correlation (ρ H, A = −53% where ρ represents cross-correlation, H the Hurst exponent, and A ApEn). However, the average prediction power on the direction of future price change has the strongly positive correlation with the Hurst exponent (ρ N N , H = 86% where N N represents the average prediction power calculated by the NN method)), and the negative correlation with the ApEn (ρ N N , H = −42%). Therefore, the market index with less market efficiency has higher prediction power for future price change than one with higher market efficiency when we analyze the market using the past price change pattern. Furthermore, we show that the Hurst exponent, a measurement of the long-term memory property, provides more significant information in terms of prediction of future price changes than the ApEn and the NN method.