Studying the Moderating Role of Firm Size on the Relationship Between Cost Stickiness and Conservatism Levels (Comparative Study of Basu Models, Non-Operating Accruals and Market Value)
Subject Areas : Journal of Capital Market Analysis
zekvan imani
1
,
Mohammad Hossein Ranjbar
2
,
Faeq Ahmadi
3
,
Hamidreza Vakilifard
4
1 - Department of Accounting, Qeshm Branch, Islamic Azad University, Qeshm, Iran
2 - Department of Accounting, Bandarabbas Branch, Islamic Azad University, Bandarabbas, Iran
3 - Department of Accounting, Qeshm Branch, Islamic Azad University, Qeshm, Iran
4 - Department of Management and Economics, Science and Research Branch, Islamic Azad University, Tehran, Iran
Keywords: Conservatism Levels, Cost Stickiness, Size of the Company,
Abstract :
Recent studies have revealed that if both conservatism and cost stickiness exist, not considering cost stickiness in estimating conservatism leads to their overestimation. The present study aims to examine the relationship between cost stickiness and conservatism levels according to the size of the company. This purpose is achieved using the combined data technique and three models of non-operating accruals, Basu model and market value model with a sample consisting of 113 companies listed on the Tehran Stock Exchange (TSE) over the period 2011 to 2020. The research results indicate that stickiness of costs is related to conservatism in all three models. However,the evidence shows that cost stickiness in the market value model and basu's adjusted model has a negative relationship with conservatism and causes it to decrease. to be The results also showed that by entering the variable size into the research model, in all three models, the stickiness of costs increases, which reduces the conservatism of companies.
