Selecting the optimal model for impact of external financing variables on voluntary discretionary accruals in companies with high and low investment opportunities

Subject Areas : Investments

Omid Sabaghiyan Toosi ¹ , Zahra Moradi ² , Shohreh Yazdani ³

1 - Department of Accounting، Damavand Branch ،Islamic Azad University، Damavand، Iran.
2 - Department of Accounting، Damavand Branch ،Islamic Azad University، Damavand، Iran.
3 - Department of Accounting، Damavand Branch ،Islamic Azad University، Damavand، Iran.

Received: 2022-02-22 Accepted : 2022-05-30 Published : 2022-08-23

Keywords: External Financing, Voluntary Discretionary Accruals, Different Investment Opportunities, Financial Constrains,

Abstract :

Purpose: This study explaining the effect of external financing on voluntary discretionary accruals in companies with high and low investment opportunities. In this research, the data of 320 companies during the years 2011-2021 have been analyzed using eviews econometric software.Methodology: To test the sub-hypotheses using the middle of 4 methods (MEQLDTA), (MB), (EQGMEQLD) and (Growth PPE), the statistical population was classified into two groups of companies with high and low investment opportunities. Then the hypotheses were tested using unstructured estimation and ordinary least squares (OLS) methods and maximum likelihood logarithm (ARMA).Findings: Results of group  hypotheses: There is a positive significate relationship between the use of voluntary discretionary accruals and external financing in companies with high investment opportunities, that are separated by MEQLDTA method and there is a negative significate relationship with GROWTHPPE method, but there is a no significate relationship in other methods. Results of group  hypotheses: There is a negative significate relationship between the use of voluntary discretionary accruals and external financing in companies with low investment opportunities, that are separated by PPEQGMEQLD method and there is a positive significate relationship with GROWTHPPE method, but there is a no significate relationship in other methods. Based on  and D-W coefficients, optimal models were selected in companies with high and low investment opportunities..Originality / Value: To achieve the optimal investment opportunities, it is recommended to pay attention to the company's financing method in high and low investment opportunities.

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