The Effect of Industry Type on the Relationship between Financial Reporting Transparency and Financial Health in Tehran Stock Exchange

Subject Areas : Financial Accounting

Gholamreza  Taherpour ¹ (Department of Accounting, Islamic Azad University, Aliabad Katoul Branch, Aliabad Katoul, Iran)
Ali  Khozain ² (Department of Accounting, Islamic Azad University, Aliabad Katoul Branch, Aliabad Katoul, Iran)
Arash  Naderian ³ (Department of Accounting, Islamic Azad University, Aliabad Katoul Branch, Aliabad Katoul, Iran)
Gemadverdi  Gorganli Doji ⁴ (Department of Accounting, Islamic Azad University, Aliabad Katoul Branch, Aliabad Katoul, Iran)

Received: 2019-08-28 Accepted : 2020-06-15 Published : 2022-04-01

Keywords: Tehran Stock Exchange, Financial Reporting Transparency, Financial health,

Abstract :

This study aimed to evaluate the effect of industry type on the relationship between financial reporting transparency and financial health in companies listed in Tehran Stock Exchange. The statistical population included companies listed in Tehran Stock Exchange during 2005 to 2016. By systematic elimination, 79 companies from 5 industries were selected as statistical sample and were tested by composite regression of hypotheses. Results of significant coefficients test based on fitted regression equations indicated a significant positive relationship between financial reporting transparency and financial health. The moderating relationship of industry type was also confirmed on the relationship between financial reporting transparency and financial health. Hence, business continuity and profitability (financial health) will be greater by investing in companies that have greater financial reporting transparency. Thus, the relationship between financial reporting transparency and financial health is high in industries of automobile, auto part, basic metals, chemicals, cement, lime and plaster, and pharmaceuticals, respectively.

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