[Home ] [Archive]   [ فارسی ]  
:: Main :: About :: Current Issue :: Archive :: Search :: Submit :: Contact ::
Main Menu
Home::
Journal Information::
Articles archive::
For Authors::
For Reviewers::
Registration::
Contact us::
Site Facilities::
::
Search in website

Advanced Search
..
Receive site information
Enter your Email in the following box to receive the site news and information.
..
:: year 8, Issue 31 (2016) ::
fa 2016, 8(31): 30-50 Back to browse issues page
The Effect of Financial Reporting Qualityand Disclosure Quality on the Cost of Capital: Instrumental Variable Approach
Abbas Aflatooni * 1, Amin Amirbakhtiarvand1
1- Bu-Ali Sina University of Hamadan
Abstract:   (4628 Views)

The cost of capital is defined as the minimum rate of return which the company must obtain so that the shareholders' wealth, not decrease. The information asymmetry among firms, shareholders and creditors can increase the cost of capital. One way to reduce information asymmetry and consequently reduce the cost of capital is to improve the quality of financial reporting and the disclosure quality. This object is mentioned in previous researches, but it should be noted that the financial reporting quality and disclosure quality are affected by other variables. This can cause the endogenity bias in the regression model and report the unreliable results. However, the possibility of this problem is not considered in previous internal researches. To overcome the endogenity bias, this paper study the relationship among financial reporting quality, disclosure quality and the cost of capital, using instrumental variable and the generalized method of moments (GMM) estimator in 124 firms listed in Tehran Stock Exchange during 2003 to 2015. The research findings confirm the endogenity bias and the results of using instrumental variable demonstrate a significant negative relationship between financial reporting quality, disclosure quality and the cost of capital.

Keywords: A New Approach in Investigating the relationship between Financial Reporting Quality, Disclosure Quality and the Cost of Capital
Full-Text [PDF 754 kb]   (2892 Downloads)    
Type of Study: Research | Subject: Special
Send email to the article author

Add your comments about this article
Your username or Email:

CAPTCHA


XML   Persian Abstract   Print


Download citation:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:

Aflatooni A, amirbakhtiarvand A. The Effect of Financial Reporting Qualityand Disclosure Quality on the Cost of Capital: Instrumental Variable Approach. fa 2016; 8 (31) :30-50
URL: http://qfaj.mobarakeh.iau.ir/article-1-900-en.html


Rights and permissions
Creative Commons License This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
year 8, Issue 31 (2016) Back to browse issues page
فصلنامه حسابداری مالی Quarterly Financial Accounting
Persian site map - English site map - Created in 0.04 seconds with 35 queries by YEKTAWEB 4679