بررسي رابطه ي بين مديريت سود و جريان هاي نقد آزاد در شركت هاي پذيرفته شده در بورس اوراق بهادار تهران

An investigation of relationship between earnings management and free cash flows in the companies listed in Tehran stock exchanges

Most researches have used Jensenʹs hypothesis to examine the relationship between earnings management and free cash flows (FCF). Jensen (1986) argues that managers in low-growth firms with high FCF will use income-increasing accruals to obtain their benefits in short time. Using a sample of 90 firms through 1999-2004, we found that there is a positive relationship between earnings management and free cash flows and also between earnings management and two levels of FCF (high and low) separately. In result we argue that FCF can be incentive to manage earnings by managers. Also by using Wald test, we showed that the relationship is stronger in high -FCF firms than low -FCF firms and in low-growth firms with high -FCF than high-growth firms with high -FCF. This shows that Jensenʹs hypothesis is accepted in companies listed in Tehran Stock Exchanges.