The effect of Economic Policy Uncertainty on the Financial Statement Comparability:moderating effect of Accounting Estimates

Nadri, Faranak; Kabiri, Mohamad taghi

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year 13, Issue 52 (2021)

fa 2021, 13(52): 110-133

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The effect of Economic Policy Uncertainty on the Financial Statement Comparability:moderating effect of Accounting Estimates

Faranak Nadri¹

, Mohamad taghi Kabiri ^*

1- danesh gahe lorestan
2- Management Department, Faculty of Administrative Sciences and Economics, Arak university, Arak, Iran.

Abstract: (2350 Views)

Comparability is one of the unique features of financial information that increases its usefulness. Investors and shareholders can not make optimal financial and investment decisions without comparable information. It seems that one of the factors that can affect the comparability of financial statements is the issue of uncertainty about the economic policies of governments. Uncertainty of economic policies can affect the performance and accounting estimates of companies, and this in turn affects the quality of profits and the comparability of financial statements. In view of the above, the purpose of this study is to The effect of Economic Policy Uncertainty on the Financial Statement Comparability: moderating effect of Accounting EstimatesThe statistical population of the study consisted of 128 companies during the period of 2012-2021. The statistical method used to test the hypotheses presented in this study is the combined data method. The research model was tested and analyzed using multivariate regression statistical method using EViews software.
The result of the first hypothesis of the study showed that the uncertainty of economic policies has a negative and significant effect on the comparability of financial statements. Also, the results of the second hypothesis of the study showed that the negative effect of economic policy uncertainty on the comparability of financial statements is not stronger when cross-sectional variability is greater in accounting estimates.The result of the first hypothesis of the study showed that the uncertainty of economic policies has a negative and significant effect on the comparability of financial statements. Also, the results of the second hypothesis of the study showed that the negative effect of economic policy uncertainty on the comparability of financial statements is not stronger when cross-sectional variability is greater in accounting estimates.

In general, the results showed that in the context of economic policy uncertainty, managers use a negative and uncertain tone in their financial reporting, and this in turn negatively affects the quality of profit and the ability to compare financial statements.

Article number: 5

Keywords: Financial Statement Comparability, Economic Policy Uncertainty, Accounting Estimates

Full-Text [PDF 634 kb] (96 Downloads)

Type of Study: Research | Subject: Special

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Nadri F, Kabiri M T. The effect of Economic Policy Uncertainty on the Financial Statement Comparability:moderating effect of Accounting Estimates. fa 2021; 13 (52) : 5
URL: http://qfaj.mobarakeh.iau.ir/article-1-2578-en.html

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