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:: year 17, Issue 65 (2025) ::
fa 2025, 17(65): 115-91 Back to browse issues page
Investigating the Impact of Managerial Overconfidence on Earnings Quality with the Moderating Role of Ownership Structure
Behrooz Badpa *1 , Amin Ghanbari2
1- Department of Accounting, Ilam University, Ilam, Iran. & -
2- Ilam University, Ilam, Iran. & -
Abstract:   (77 Views)
 Based on the concepts of agency theory, the relationship between owners and management is potentially reflected in the quality of financial reporting and business outlook. Also, from a financial-behavioral perspective, the psychological and personality dimensions of managers are linked to how the firm is led and makes strategic decisions. In this regard, designing corporate governance frameworks and systems, such as ownership structure, is of great importance in order to curb managerial biases. Accordingly, the aim of the present study is to test the effect of managerial overconfidence on earnings quality with the moderating role of ownership structure. Five research hypotheses were tested and analyzed using a sample of 166 companies listed on the Tehran Stock Exchange during the period 2013 to 2023 and using multiple regression. The results of the study showed that management overconfidence has a significant negative effect on the quality of company earnings. Also, among the different dimensions of ownership structure, three variables, namely family ownership, managerial ownership, and institutional ownership, weaken the negative effect of management overconfidence on earnings quality, but ownership concentration does not have a significant effect on this relationship. Therefore, ownership structure as a corporate governance mechanism provides a new perspective on the impact of management overconfidence on earnings quality. Ownership structure can affect managerial behavior and attitudes, and consequently, corporate reporting. In particular, ownership concentration and the nature of shareholders can moderate the impact of management overconfidence on earnings quality.
Article number: 6
Keywords: Management Overconfidence, Earnings Quality, Ownership Structure, Agency Theory, Convergence of Interests.
Full-Text [PDF 1053 kb]   (48 Downloads)    
Type of Study: Research | Subject: Special
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Badpa B, Ghanbari A. Investigating the Impact of Managerial Overconfidence on Earnings Quality with the Moderating Role of Ownership Structure. fa 2025; 17 (65) : 6
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