Investigating the impact of monitoring intensity and financial reporting time on information asymmetry with respect to agency costs on corporate governance

Document Type: Research Paper

Authors

1 Islamic Azad University

2 Department of Managment, Arak Branch, Islamic Azad University, Arak, Iran

10.22034/amfa.2019.666213

Abstract

Financial reporting goals originate from the needs and desires of the external users. The main objective is to express the economic effects of events and financial operations on the status and performance of the business unit to help foreign entities make financial decisions in relation to the business unit. In this thesis, the effect of monitoring intensity and financial reporting times on information asymmetry of companies in Iran has been investigated. Following the design of the monitoring indicators, the transaction information was collected from the Stock Exchange in the five-year period of 2011-2015. The statistical sample consisted of 155 companies selected by systematic elimination method in which totally obtained 775 year-firm. Linear regression and correlation were used to investigate the hypotheses of the research. And Eviews software has been used to analyze the data and test the hypotheses. What can be summarized in the overall conclusion of the research hypothesis test is that the intensity of monitoring and the financial reporting times have a significant impact on the information asymmetry. Other results indicated that agency costs affect the relationship between the intensity of monitoring and the financial reporting times by asymmetry of information. The results obtained in this study are consistent with the documentation referenced in the theoretical framework and financial literature.

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