The Survey of the Political Costs and Firm Size: Case from Iran

Tehrani, Reza; Salehi, Mahdi; Valipour, Hashem; Lashky, Mohammad Jahandar

doi:10.1201/b12879-4

Cited by 3 publications

(4 citation statements)

References 7 publications

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“…Based on Tehrani et al (2009), we select some indicators that are considered as an example of firms political cost and we compare their means between different groups. These indicators are insurance right, donations and grants, direct and indirect tax.…”

Section: Resultsmentioning

confidence: 99%

“…A number of studies used corporate tax rates as an alternative measure of political costs. In fact, Tehrani et al (2009) suggest that tax, insurance, managerial munificence costs, free helps, sport helps, export custom laws and establishing the seminars costs are assimilated to political costs. Furthermore, Han and Wang (1998) consider that firms use accounting policies to reduce their incomes and, therefore, reduce the amount of payable tax.…”

Section: Hypothesis Developmentmentioning

confidence: 99%

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Political costs and earnings management: evidence from Tunisia

Attia

Lassoued

Attia³

2016

JAEE

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Purpose The purpose of this paper is to test the political costs hypothesis in emerging economies characterized by interventionist governments and weak protection of property rights. The paper uses executives’ political connection and state control to measure firms’ political costs. Design/methodology/approach Based on a sample of Tunisian firms, univariate and multivariate analyses are used to test whether firms’ political costs have any impact on earnings management. Findings The empirical analysis indicates that the executives’ political connection is not directly related to earnings management. However, the interaction between executives’ political connection and the state control affects the firm’s sensitivity to political pressure and its earnings management practices. More specifically, this study provides evidence that non-connected firms and state-controlled firms attempt to use accounting policies to decrease their earnings especially during periods of the former government when they had to face high political costs. This finding is robust to comparing means of political cost indicators between different groups. Indeed, private firms with political connection enjoy a significantly lower insurance right, tax and donations and grants compared to other firms. Research limitations/implications This study provides empirical evidence for the specific application of accounting theory in emerging economies. Practical implications Political influence may be an important criterion that will be used by auditors and investors to appreciate and detect specific manipulations of accounting earnings. Similarly, regulators should be aware of the political factors effect on discretionary behavior of managers to provide appropriate rules and standards. Originality/value The study is a pioneer in proving that a firm’s size is not always a suitable measure of its political cost. It extends the accounting literature on the role of political economy in the application of the political costs hypothesis. This hypothesis is confirmed in emerging economies by providing new and significantly measure of firms’ political costs

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Section: Resultsmentioning

confidence: 99%

Section: Hypothesis Developmentmentioning

confidence: 99%

Political costs and earnings management: evidence from Tunisia

Attia

Lassoued

Attia³

2016

JAEE

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“…Political costs refer to social costs required by corporations for continuing operations and businesses in line with regulatory requirements prevailing in a particular environment (Emadzadeh et al, 2012). The political costs often incurred by corporations take the forms of environmental rehabilitation costs, financial support for ruling or preferred political parties, sports sponsorship, costs on seminar/capacity-building workshops, Insurance premiums, donations to party during elections, monetary & non-monetary gifts and donations with political undertones (Tehrani, et al, 2009) as well as lobbying costs, cost of securing government contract and cost of avoiding government punitive regulations (Watts and Zimmerman, 1990;Emadzadeh, et al, 2012).…”

Section: Good Governencementioning

confidence: 99%

Bridging the governance gap with political CSR

Adelopo¹,

Yekini²,

Raimi³

Development-Oriented Corporate Social Responsibility Volume 1: Multinational Co

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Corporate social responsibility (CSR) has attracted varied applications in management. This chapter contribution provides evidence of a political CSR where multinational corporations (MNCs) are complementing government's role in bridging governance gap. The governance gap thesis and political costs hypothesis provide grounding for the discussions in this paper. Data from case studies across the Middle-Eastern countries were critically analysed and justify the political and developmental undercurrents of CSR initiatives. The key argument is that governance is crucial for development, and where there is a governance gap, it is in the interest of corporations to bridge the gap with their CSR initiatives to stimulate development. Pressure groups and civil society organisations in developing countries could leverage on the political dimension of CSR to lobby corporations to intervene in socioeconomic issues especially poverty alleviation through entrepreneurship development in their operating environment for mutual benefits.

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“…"que o tamanho da companhia perde relevância em face de incentivos concedidos a empresas geradoras de empregos Zimmerman (1983). também foi testado para o ambiente iraniano Tehrani et al (2009). analisaram as empresas listadas na Bolsade Valores de Teerã, no período de 2005 a 2007.…”

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Custos políticos tributários: o impacto do tamanho na alíquota tributária efetiva

Lopes¹

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Escrever esses agradecimentos é rememorar todo o carinho e ajuda que recebi ao longo desses quatro anos de doutorado, é lembrar, ainda que não nomeados, de todos os que, de alguma forma, contribuíram e auxiliaram neste trabalho. Primeiramente, agradeço a Deus, por estar sempre presente na minha vida, mesmo quando eu não merecia, por me dar força e perseverança para completar mais essa fase, por se mostrar fiel quando eu mais precisei. À minha família, mais uma vez obrigada pela paciência, por todo o apoio, meus gordinhos, sem vocês isso não seria possível. Ao Prof. Dr. Iran Siqueira Lima por aceitar mais uma vez ser meu orientador, por acreditar ser possível o desenvolvimento deste trabalho, por me ajudar a traçar o caminho e acima de tudo por ser compreensivo com esta orientanda. Ao Prof. Dr. Alexsandro Broedel Lopes por auxiliar na escolha do tema na disciplina de Teoria Avançada da Contabilidade, por aceitar a co-orientação e por todas as sugestões. Ao Prof. Dr. Arthur Ridolfo Neto por todas as justificadas críticas e mais ainda pelas sugestões na banca de qualificação que possibilitaram novos caminhos e perspectivas a esta pesquisa. Ao Prof. Dr. Ariovaldo dos Santos e ao Nivaldo Gomes Lamac pela seleção e disponibilização da base de dados da Revista Melhores e Maiores. E a Fipecafi e a Revista Exame pela manutenção de tão importante ferramenta de pesquisa contábil. Agradeço, ainda, aos professores que ministraram as disciplinas por mim cursadas, por todos os ensinamentos e correções, pelo incentivo à pesquisa: Dra.

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The Survey of the Political Costs and Firm Size: Case from Iran

Cited by 3 publications

References 7 publications

Political costs and earnings management: evidence from Tunisia

Political costs and earnings management: evidence from Tunisia

Bridging the governance gap with political CSR

Custos políticos tributários: o impacto do tamanho na alíquota tributária efetiva

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