Studying the Effect of Accounting Bias on Financial Policies of Companies Listed on Tehran Stock Exchange

Document Type : Original Article

Authors
Mohamad Sadegh Shahsavari 1
Mohammad Hossein Ranjbar 2
Hojjatallah Salari 3
Ali Amiri 4
1 Phd Student in Accounting,Bandar Abbas Branch,Islamic azad university , bandar abbas,Iran.
2 Assoiate Professor,Department of Accounting and Finance,Bandar Abbas Branch,Islamic azad university , bandar abbas,Iran.
3 Department of Accounting, Bandar Abbas Branch,Islamic azad university , bandar abbas,Iran.
4 Department of Accounting,Bandar Abbas Branch,Islamic azad university , bandar abbas,Iran.
10.22034/jmaak.2024.78056.4426
Abstract
This study examined the effect of accounting bias on financial policies of companies listed on Tehran Stock Exchange. The statistical population of the study included 14 top investment companies and their investee companies, consisting of 109 companies, during the period 2014-2019. Also, financial leverage, cash earnings per share, and debt ratio were used as indicators of financing policy. The panel data model and STATA software were used to analyze the data. The results showed that the investment companies studied showed accounting behavioral bias in 35.71% of cases. Also, investors' accounting bias has a significant negative effect on financial leverage, a negative effect on homogeneous cash earnings per share, and a significant direct effect on debt ratio as indicators of companies' financing policy. Because accounting as an irrational financial behavior, due to the propensity effect, causes loss aversion and reversion to the mean of stock returns, resulting in a decrease in stock returns and subsequently reducing the ability of companies to finance through internal sources and increasing financing from external sources
Keywords
accounting method
accounting
financial policies
tabular data model
  1. اولی، محمدرضا. نیکومرام، هاشم. جهانشاد، آزیتا. پورزمانی، زهرا. (1396)، مدل قیمت­گذاری دارایی­های سرمایه­ای در چارچوب حسابداری ذهنی، دانش مالی تحلیل اوراق بهادار، 10(36): 12-1.
  2. بنابی قدیم، رحیم. کرباسی یزدی، حسین. (1393)، کاربرد تئوری حسابداری ذهنی، پژوهش حسابداری، 13: 17-1.
  3. پاکدل، عبدا... ایزدی نیا، ناصر. دستگیر، محسن. (1395)، رتبه بندی عوامل موثر حسابگری ذهنی در تشکیل پرتفوی توسط سرمایه گذاران کم تجربه به کمک تکنیک ویکور، تحقیقات حسابداری و حسابرسی، تحقیقات حسابداری و حسابرسی، 8(32).
  4. جلیلی، آرزو. مشیری، اسماعیل. (1392)، ابتکارات ذهنی در بکارگیری رویه های حسابداری مدیریت، دانش حسابداری و حسابرسی مدیریت، 2(6): 50-41.
  5. شمس، شهاب الدین. یحیی زاده فر، محمود. امامی، عباس. (1389)، بررسی رابطه اثر تمایلی با جریانات نقدی و عملکرد شرکت های سرمایه گذاری بورس اوراق بهادار تهران، تحقیقات مالی، 12(30): 116-95.
  6. رهنمای رودپشتی، فریدون. جلیلی، آرزو. (1389)، حسابگری ذهنی و ارزیابی متوازن، تحلیل تعاملی و رفتاری، مجله علمی پژوهشی حسابداری مدیریت، زمستان 89.
  7. کیان، علیرضا. پورحیدری، امید. کامیابی، یحیی. (1396)، تأثیر حسابداری ذهنی بر رفتار سرمایه‌گذاران از دید گزارشگری مالی، پژوهش های حسابداری مالی، 9(2): 22-1.
  8. Alexander, Gordon J., Baptista, Alexandre M., Yan, Shu. (2016), Portfolio selection with mental accounts and estimation risk, Journal of Empirical Finance, doi: 10.1016/j.jempfin.2016.07.012.
  9. Bonner, S. Proell, S. C. Koonce, L. Wang. , T. (2013). Mental accounting and Disaggregation on the Income statement.
  10. Cici G (2005)."The relation of the disposition effect to mutual fund trades and performance", works paper, University of Pennsylvania.
  11. Das, S, R and Statman, M (2009)" Beyond Mean-Variance: Portfolios with Derivatives and Non-Normal Returns in Mental Accounts"Available at http://papers.ssrn.com/sol3/papers. Cfm? abstract_id=1782309.
  12. DeLisle, Jared and Diavatopoulos, Dean and Fodor, Andy and Krieger, Kevin, Prospect Theory, Mental Accounting, and Option Prices (February 7, 2015). Available at SSRN: https://ssrn.com/abstract=2561887 or http://dx.doi.org/10.2139/ssrn.2561887
  13. Fennema, B. and Koonce, L. (2010).”Mental Accounting in Financial Reporting and Voluntary Disclosure”.
  14. Frazzini, A. (2006). "The disposition effect and under reaction to news. Journal of Finance", 61, 2017-2046.
  15. Gordon, W. V. Shohin, E. (2016), The Mechanisms of Mindfulness in the Treatment of Mental Illness and Addiction, International Journal of Mental Health and Addiction, 14(5): 844.849.
  16. Grinblatt M, Han B (2005). "Prospect theory, mental accounting, and momentum". Journal of Financial Economics, 78: 311–339
  17. Lim, S. (2003), Mental Accounting and Selling Decisions of Individual Investors; Analysts’ Reputational Concerns and Under reaction to Public News, Dissertation Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the Graduate School of The Ohio State University.
  18. Mascareñas, J. Yan, F. (2017), How People Apply Mental Accounting Philosophy to Investment Risk?, International Journal of Economics and Financial Issues, 7(3): 145-151.
  19. Odean, T. (1998).Are Investors Reluctant to Realize Their Losses? The Journal of Finance, 53(5), 1775-1798.
  20. Pompian, Michael M. (2006). Behavioral Finance & Wealth Management, Published by Jon Wiley & Sons, Inc., Hoboken, New Jersey 2006.Published Simultanceously in Canada./www.wiley.com/go/permissions.
  21. Seiler, M. Seiler, V. L. Lane, M. (2010), Mental Accounting and False Reference Points in Real Estate Investment Decision-Making, Forthcoming in Journal of Behavioral Finance.
  22. Shefrin H, M. Statman (1985). "The disposition to sell winners too early and ride losers too long: Theory and evidence", Journal of Finance, Vol. 40: 777-790.
  23. Thaler, R. (1980). Mental accounting and consumer choice. Marketing Science, Vol. 4, Pp. 199-214.
  24. Zhaojin, X. (2007). "Selling winners and holding losers: Effect on mutual fund performance and flows", Dissertation of Doctor of philosophy in finance on faculty of the Virginia: 1-98.