Effect Of Managers' Behavioral policy On Abnormal Transactions With Affiliates
Subject Areas : Public Policy In Administrationnazanin bashirimanesh 1 , zohreh arefmanesh 2 , mohammad souri 3
1 - Assistant Professor, Department of Accounting, Faculty of Management, Economics and Accounting, Payam Noor University, Tehran, Iran. (Corresponding Author) bashirimanesh@gmail.com
2 - Assistant Professor, Department of Accounting, Faculty of Management, Economics and Accounting, Yazd University, Yazd, Iran.
3 - MSc. Student in Accounting, pnu universityt,Tehran, Iran
Keywords: Managers' shortsightedness, Managers' narcissism, managers' overconfidence, Abnormal dealings with dependents,
Abstract :
Background: The main role of managers in companies is to make decisions in various areas such as investment, profit sharing policy, transactions with affiliates. One of the factors influencing managers' decision-making approaches is their behavioral policy.Objective: The present study investigates the effect of managers' behavioral bias on abnormal transactions with affiliates.Methods: The statistical population of the study is the companies listed on the Tehran Stock Exchange and using the systematic elimination sampling method, 146 companies were selected as the sample of the research in a period of 7 years between 1392 to 1398. The method used to collect information is a library and the relevant data for measuring variables were collected from the Cadal site and companies' financial statements and in Excel preliminary calculations were performed and then Stata software was used to test the research hypotheses.Findings: The results show that managers' narcissism has a significant inverse effect on abnormal net credit and abnormal net sales. However, managers' overconfidence has a direct and significant effect on abnormal net worth and abnormal net sales. Also, managers' shortsightedness has a direct and significant effect on abnormal net credit and abnormal net sales.Conclusion: Transactions with affiliates allow the exchange of resources, services, or liabilities with individuals such as major shareholders, affiliates, and subsidiaries. Therefore, the behavioral policy of managers affects the use of transactions with affiliates in order to achieve personal goals or promote profitability.
_||_
Ahmed, A. S., & Duellman, S. (2013). Managerial Overconfidence and accounting Conservatism. Journal of Accounting Research, 51(1). 1-30.
Amiri, E., Khodamipour, A., & Kamyabi, Y. (2019). The Impact of Myopic and Optimistic Management Behaviors on the Transparency of Financial Information. Applied Research in Financial Reporting, 7(2), 141-177.(in Persian).
Anderson, T. W. & Hsiao, C. (1982). Formulation and estimation of dynamic models using panel data. Journal of econometrics, 18(1), 47-82.
Arabsalehi, M., & Hashemi, M. (2015). The Effect of Managerial Overconfidence on Tax Avoidance, Accounting and Auditing Review, 22(1), 85-104. (in Persian).
Barandak, S., jamshidi, N., mohammad panah, L., & amini, M. (2020). The effect of financial factors on Managers Myopia in companies listed on Tehran Stock Exchange. Journal of Accounting and Management Vision, 2(17), 63-78. (in Persian).
Blue, G., & Hasani Alghar, M,. (2015). Examining Managerial Overconfidence Effect on Earnings Smoothing in Companies Listed in Tehran Stock Exchange, Journal of Accounting Knowledge, 6(21), 33-56. (in Persian).
Chen, Y., Lin, F., & Yang, S. Y. (2015). Does institutional short-termism matter with managerial myopia?. Journal of Business Research, 68: 845-854.
Didar, H., Mansourfar, G., & Kafami, M. (2019). The impact of corporate governance mechanisms on the tax gap of listed companies in Tehran Stock Exchange. Accounting and Auditing Review, 21(4), 409-430. (in Persian).
Farah Mita, A., & Utama, S. (2015). The Influence of Corporate Governance Mechanism on the Relationship between Related Party Transactions and Earnings Management. International Research Journal of Business Studies, 7(1): 1-12.
Habib, A., Jiang, H, & Zhou, D. (2015). Related party transactions and audit fees: Evidence from China. Journal of International Accounting Research, 14 (1): 59-83.
Habib, A., & Muhammadi, A., & Jiang, H.,(2017). "Political Connections and Related Party Transactions: Evidence from Indonesia," The International Journal of Accounting, Elsevier, vol. 52(1), pages 45-63.
Hamidian, M., Jannat Makan, H., & Ben Goriz, F. (2018). The impact of kind of attitude executives on Information Asymmetry, Financial Leverage and Firm's Value. Management accounting and auditing knowledge, 7 (25), 163-180. (in Persian).
Healy, P. M. and. Wahlen J. M. (1999). A Review of the Earnings Management. Literature and Its Implications for Standard Setting, Accounting Horizons, 13, 365-383.
Hendratama, T. D., & Barokah, Z. (2020). Related party transactions and firm value: The moderating role of corporate social responsibility reporting. China Journal of Accounting Research. 13 (2). 1-14.
Huang, W., Jiang F., Liu, Z. and Zhang, M. (2011). “Agency cost, top executives' Overconfidence, and Investment-cash Flow Sensitivity- Evidence from Listed Companies in China”. Pacific-Basin Finance Journal, 19: 261-277.
Kholbeck, M. J., & Mayhew, B. W. (2004a). Related Party Transactions. Social Science Research Network, www.ssrn.com, Working Paper Series.1-40.
Maskani, M., & Abdoli, M. (2020). Investigating the Effectiveness of Tournament incentive on Relationship between CEO Behavioral Bias with Internal Control Weakness in Companies listed in the Tehran Stock Exchange. Financial Management Strategy, 8(2), 135-155. (in Persian).
Mehrabanpour, M., Jandaghi Ghomi, M., & Mohammadi, M. (2017). Political Connections and Abnormal Transactions by Related Parties, journal of Value & Behavioral Accounting, 2(3): 147-168 . (in Persian).
Moradi, J., & Bagheri, H. (2014). A comparative investigation into the Effects of Management Myopia and Earnings Management on Stock Return. Accounting and Auditing Review, 21(2), 229-250. (in Persian).
Moscariello N. (2010). Related Party Transaction: Opportunistic or Efficient Behavior? Evidence from the Italian Listed Company. International Journal of Disclosure and Governance .Vol. 9, 2, 126–147
Myung, G. L., Minjung, K., & Ho, Y. L. (2016). Related Party Transactions and financial statement comparability: evidence from south korea. Isia-pacific journal of accounting and economics, 23(2):224-252.
O’Reilly III, C. A., Doerr, B., Caldwell, D. F., & Chatman, J. A. (2014). Narcissistic CEOs and executive compensation. The Leadership Quarterly, 25 (2), 218–231.
Posen, H. E., Leiblein, M. J., & Chen, J. S. (2018). Toward a behavioral theory of real options: Noisy signals, bias, and learning, Strategic Management Journal 39(4): 1112-1138.
Ridge, J., & White, M. (2014). The influence of managerial myopia on firm strategy. Management Decision, 52: 602-623.
Rubin A(٢٠٠٧). "Ownership Level, Ownership Concentration and Liquidity". Journal of Financial Markets. 10 (3), 219-248.
Sheri, S., & Hamidi, E. (2012). Identifying Motives of Related Party Transactions. Empirical Research in Accounting, 2(4), 49-64. (in Persian).
Srinivasan, R., & N. Ramani. (2019). With Power Comes Responsibility: How Powerful Marketing Departments Can Help Prevent Myopic Management. Journal of Marketing, Vol. 83, No. 3, Pp. 108–125.
Srinivasan, R., & Ramani, N. (2019). With Power Comes Responsibility: How Powerful Marketing Departments Can Help Prevent Myopic Management. Journal of Marketing, Vol. 83, No. 3, Pp. 108–125.
Taghizadeh Khanqah, V., & Badavar Nahandi, Y. (2020). Relationships between Managerial Overconfidence, Internal Financing and Investment Efficiency. Journal of Accounting Knowledge, 11(2), 209-238. (in Persian).
Tehrani, R., & Delshad, A. (2018). Investigation of Managerial Myopia on Future Financial Performance in Companies Listed on Tehran Stock Exchange. Journal of Accounting and Social Interests, 8(2), 23-46. (in Persian).
Vaez, S. A., Anvari, E., & Banafi, M. (2016). the effect of ownership structure on the relationship between related party transactions and investment efficiency. quarterly financial accounting journal. 8 (31) :101-132. (in Persian).
Vaghfi, S., Salmanian, M., Manian, F., & Fayaz, A. (2018). The Relation of Related Party Transactions To Disclosure Quality, Earnings Management and Profitability. Empirical Research in Accounting, 8(2), 71-94. (in Persian).
Winifred, H., Neophytes, L., and M,H. James. (2016). Motives for Corporate Cash Holdings: the CEO Optimism Effect. Review of Quantitative Finance and Accounting. Vol. 47 No. 3, Pp. 669-732.
Zadparvar, F. (2017). Fraud and misbehavior of managers in financial reporting: A review of research from a financial perspective. Journal of horizons Humanities 1(10). 31-43. (in Persian).