Indian Journal of Science and Technology
Year: 2015, Volume: 8, Issue: 11, Pages:
Farzaneh Heidarpoor1* and Farhad Sheikhi Shahrivar2
1 Department of Accounting, Central Tehran Branch, Islamic Azad University, Tehran, Iran; [email protected]
2 Department of Accounting, Gheshm Branch, Islamic Azad University, Gheshm, Iran
Background/Objectives: Determination of the accounting information quality and its results is interest of investors, managers, legislators and standards drafters. The objective of the study was to evaluate the effectiveness of internal control quality and unsystematic risk on the earning quality by use of the index volatility profits of the firms, listed on the Tehran Stock Exchange.
Methods/Statistical Analysis: In this study, the quality of internal control and non-systematic risks are considered as independent variables to examine their impact on the index of volatility profits of earning quality in the firms.
Results: In this study, using panel data with fixed effects, the results of the data analysis using multiple regression at 95%, indicate that there is a significant direct relationship between the quality of internal controls and non-systematic risks with the index of volatility profits of quality in the firm earning.
Conclusion/Application: It is recommended to the managers of the companies to provide an increase in earnings quality through the establishment of a strong internal control system and internal audit unit.
Keywords: Earning Quality, Internal Control Quality, Unsystematic Risk
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