Ownership balancing, monitoring performances of independent managers and quality of earnings forecasts by management

This study is evaluated the relation between characteristics of independent managers and prejudice the earnings forecasts by management. Four independent variables include bonuses of board of directors’ members, the percentage of independent managers in the board, the average of independent managers of the board and financial expertise were considered as the characteristics of independent managers, and quality of earnings forecasts which includes management prejudice about earnings forecasts, was considered as dependent variable. Statistical population of this study consists of companies listed in Tehran Stock Exchange, and companies in the automotive and also cement industries were used as statistical samples. Time period of this study was from the beginning of 2010 to the end of 2012. Sampling method was systematic elimination consists of 1 statistical models which were tested using multivariate regression. Data were collected using RAHAVARD NOVIN software and were analyzed using EViews 7 statistical software. The results of this study indicate that prejudice the earnings forecasts by management is significantly related with bonuses of board members, the percentage of independent managers in the board and the average of independent managers of the board. Then companies were divided into two categories consist of more balanced and less balanced ownership, and results showed a significant relation between bonuses of board members in companies with more balanced ownership and prejudice the earnings forecasts by management. Also, results indicated a significant relation between the percentages of independent managers in the board of companies with less balanced ownership and prejudice the earnings forecasts by management, as well between the percentages of independent managers in the board of companies with more balanced ownership and prejudice the earnings forecasts by management.

ownership balancing, monitoring performances of independent managers, quality of earnings forecasts, management