operating cash flow

In today's business environment, issues related to financial management, trust, and firm value are critical for the robustness and progress of any organization. Among the factors that may influence these relationships are the mediating roles of operating cash flow and tax aggressiveness. This research aims to investigate how operating cash flow and tax aggressiveness mediate the relationship between managerial overconfidence and firm value in companies listed on the Tehran Stock Exchange.

To test the research hypotheses, we selected 166 companies as the research sample for the period between 2014 and 2019. We analyzed the data using the regression method with static and dynamic panel data, utilizing Eviews13 software.

The research reveals a positive and significant relationship between managerial overconfidence and firm value. Additionally, the findings indicate that operating cash flow and tax aggressiveness mediate this relationship.

This research demonstrates that operating cash flow and tax aggressiveness play essential mediating roles in the relationship between managerial overconfidence and firm value. These findings suggest that managerial overconfidence can lead to an increase in firm value, and this relationship is significantly influenced by operating cash flow and tax aggressiveness.

The main purpose of the current research is to examine the relationship between accrual accounting (matching principle) with operating cash flow in companies listed on the Tehran Stock Exchange during the years 2013 to 2022. in this research; in this research; Using accrual accounting (matching principle) as an independent variable, operating cash flow as dependent variable and company size variables, independence of the board of directors, rate of return on assets, capital expenditures, market value to book value and financial leverage as control variables. The statistical sample of the research includes 125 companies. The research method is descriptive-correlation with an applied approach, and the method of collecting information in the theoretical foundations section is the library method, and in the hypothesis testing section, the document analysis method of financial statements. In general, the hypothesis testing method is correlation and multiple regression testing. The results of the research showed that there is a direct and significant relationship between the use of accrual accounting (matching principle) and operating cash flow ; This means that using accrual accounting and complying with the matching principle in reporting expenses and incomes will increase the company's cash flows

Business enterprise management should always look for opportunities to increase the value of the company. Without generating sufficient cash, new products cannot be produced and sold, therefore, the value of fim will not improve without generating sufficient operating cash. Therefore, the purpose of this research is to measure the efficiency of managers in creating operating cash flow based on data envelopment analysis, in line with the goals of financial reporting, and then examine the relationship between the efficiency score and real earnings management. The statistical population of the research is the companies listed in the Tehran Stock Exchange. Theoretical foundations and research data have been collected according to library studies. Multivariable linear regression was used for statistical analysis. The results of this research show that the efficiency of managers in creating operating cash flows during the research period is a downward trend. Also, the efficiency of managers in creating operating cash flows has a negative and significant relationship with real earnings management.

Since the advent of accounting scandals in the early 21st century, the importance of cash flow statements has increased significantly. Among cash flow statement items, for users of financial information, cash flow operating is important. In recent years, researchers have paid attention to the issue of classification shifting in the items among financial statements and especially the items classification shifting in the statement of profit or loss. However, research on classification shifting in the case of cash flows is relatively rare. Classification shifting is a method that managers can use to change cash flows. In the classification shifting, managers can change the figures among the different classes of financial statements. Classification Shifting can occur between the profit and loss statement or the cash flow statement. One of the concerns that arises especially during the initial public offering and challenges investors with it, the issue is whether the cash flow is positive before the public offering. Information asymmetry between participants in the initial public offering process causes that possible the directors of these companies to have the incentive and opportunity to manipulate the cash flow of operations in the pre-offering period; to show that the cash flow of their operating activities is positive. One of the methods that managers can use to improve their operating cash flow without affecting the net cash flow; The movement of figures between classes is a form of cash flow; Therefore, the purpose of this study is to investigate the classification shifting of cash flows among the cash flow statement.  To measure cash flows classification shifting, Negar and Sen (2016) model and using variables based on signs of cash flows )and then net cash flow of investment and financing activities as alternative variables( have been used. First, the five-tier cash flow statement based on Iranian Standard No. 2 was changed into a three-tier one based on the Financial Accounting Standards Board (FASB). Then, using the data of companies that have been going public before the research period, Dichow et al. (1998) model was cross-sectionally fitted in the year-industry level and its coefficients were extracted. In the next stage, based on various criteria, a statistical sample including 70 companies with an initial public offering listed on the Tehran Stock Exchange, in the period 2004 to 2019 was selected. Eventually; the test of research hypotheses for this sample using multiple regression is based on cross-sectional data model.  The results on the variables based on signs of cash flow outflows of investment and financing activities show that cash flow outflows of investment activities as well as cash flow outflows of financing activities have a significant positive relationship with unexpected operating cash flow. The results on the variables based on signs of cash flow from investment activities and financing showed that the cash flow of investment activities has a significant negative relationship with the flow of unexpected operating cash. However, the cash flow from financing activities has no significant relationship with unexpected operating cash flow. Also, the results of appling the variables of net cash flows from investment and financing activities indicate that there is a significant negative relationship between net financing cash flow and unexpected operating cash flow; But net investment cash flow has no significant relationship with unexpected operating cash flow.  Investors generally view operating cash flow as an important measure of operating performance that can have a important impact on their decisions. This variable becomes very important when companies do not have trading history and public release of their financial statements before offering. Given the information asymmetry that exists between participants in public offerings, it is important for investors that these companies did not transfer cash flows between different classes of cash flow in the year before the launch. Research findings indicate that these companies, in the year before offering to the public, part of the operating cash outflows are transferred to the investment or financing cash outflows and part of the investment cash inflows are transferred to the operating cash inflows. In general, the findings support the involvement of companies with an initial public offering in the cash flow classification shifting in the year before the offering. The findings of this research can be effective in the decision making of investors who intend to buy the shares of these companies. Therefore, users of financial information as potential investors, lender, and analysis should consider the effects of cash flow classification shifting the year before the initial public offering in their decision-making when buying public offering shares.

Increasing the effective awareness of intangible assets (research and development costs), causes better decisions to be made in the field of investment in the company and gain profit and performance. The strategies used for research and development costs, which require limiting the flow of company information to the capital market and other authorities, allow managers to misuse company resources without the possibility of detection. The purpose of this research is to study the effect of board remuneration on the relationship between operating cash flow and research and development costs. The statistical population of the research companies admitted to the Tehran Stock Exchange and the studied sample includes 140 admitted companies during the years 2016 to 2016. The research method is descriptive and in terms of the relationship between the variables, it is a combination of causality-correlation, and it is practical in terms of the goal. The regression method and panel data as well as the fixed effects model were used to process and test the hypotheses. The results obtained from the data analysis show that the remuneration of the board of directors has a negative and significant effect on the relationship between operating cash flow and research and development costs.

The purpose of this study is to investigate the impact of operating cash flow on stock returns and earnings stability using a sample of 167 companies from2015 to 2021. This research is a quasi-experimental research in the field of positive accounting research and in terms of purpose, it is an applied research. The method of the present study is inductive and post-event and its statistical method is multiple linear regression model; The results show that the quality of accruals has a significant effect on the relationship between operating profit and cash flow with abnormal stock returns.

In firms that are not in a stable position (low-growth firms) and have cash scheduling problems, unusual accruals play a more prominent role in signaling the company's performance, and managers have accounting accruals, so the purpose of this study is to examine profitability and operating cash flow. In explaining the realized intrinsic value of the company. The statistical population of the study was all active companies listed on the stock exchange, of which 118 companies were selected as a sample. The research method was descriptive-correlational and applied objective. The regression results showed that the ability of profit and operating cash flow has a significant effect on explaining the realized intrinsic value of the company.

The amount of investment of companies can be due to several factors, one of which is the cash flow of the company and in fact the amount of financial resources available to finance new projects. How to finance new investments in the company; It is influenced by management decisions, but in general, it seems that the higher the cash flow of the company, the higher the amount of its investments. The purpose of this study is to investigate whether public ownership has a significant effect on the relationship between investment and cash flow. The statistical population of companies listed on the Tehran Stock Exchange between 2014 and 2019 and using the information of 134 companies and multivariate linear regression method was tested to hypotheses that the test results showed a significant relationship between investment and cash flow and also In other hypothesis test results, it was observed that public ownership has a significant effect between investment and cash flow.

The present study aimed at understanding the effect of managerial competency (the indicator of this variable was cashback and non-cashback reward to the board) on research and development expenditures due to the operating cash flow. For this purpose, the data of the companies listed on the stock exchange were used as the research population. The research time scope was considered from 2009 to 2016. Thus, five hypotheses were designed and the fixed effects method was used by generalized least squares method to test the research hypotheses. The results of the study indicated that operating cash flow and cashback reward have a significant positive effect on the research and development expenditures of companies while non- cashback reward has no significant effect. In addition, the results indicated the negative effect of cashback reward on the relationship between operating cash flow and research and development expenditures while non- cashback reward has no significant effect.

Institutional investors are always looking to raise their capital and are trying to control and restrict accrual earnings with more supervision in the company. The present study investigates the effect of operating cash flows on limiting accruals management with respect to institutional owners' supervision and is purposeful, practical and causal (post-event) correlation methodology. The statistical population of the study consisted of all listed companies in Tehran Stock Exchange. Using systematic elimination sampling method, 132 companies were selected as research sample and were surveyed during the 6-year period from 2012 to 2016. To test the research hypotheses, statata software version 15 and multiple regression with panel data model were used. The results show that operating cash flow has a significant and negative effect on accrual management. Institutional ownership moderates the relationship between operating cash flow and accrual profit management.

Accounting information provides a system through which intra-organizational information is transferred to capital markets and allows more control of management activities by investors. Information provided by financial reports can be useful in decision making when it is reliable and relevant. The statistical population of this study is all firms listed in Tehran Stock Exchange and the sample selected by systematic removal method, consists of 105 firms  listed during the period from 2007 to 2016. To test the variables relation, the regression analysis method based on panel data model is used. Results show that the quality of accruals, profit sustainability, profit forecast and profit smoothing are effective on operating cash flow.

Previous research has shown that the accruals component of the earnings is less persistence than its cash component and the less persistence has been attributed to the more subjectivity components of earnings accruals. Accounting earnings is one of the most important figures that investors use in stock pricing analyses. However, the use of accounting earnings information, without attention to the way it builds and incorporates its components, may have undesirable consequences in the future. Therefore, the purpose of this study is to investigate the persistence and pricing of earnings, accruals and operating cash flows in companies admitted to the Tehran Stock Exchange.
In order to achieve the research purpose, the data of 106 companies listed in the Tehran Stock Exchange from 2006 to 2016 were examined. To test the research hypotheses, the regression approach with combined data, as well as nonlinear least squares regression analysis in the form of simultaneous equations system and also Mishkin (1983) test have been used.
The results obtained show that operating earnings are persistence and that future earnings can be predicted based on current earnings trends. Also, the results showed that the persistence of the cash component of the earnings was greater than the accrual component. However, from a market perspective, investors exhibit greater reliance on accruals compared to the cash component of the earnings. Finally, there is a significant difference between the persistence of earnings and the components of the earnings estimated by the investors and the true persistence of the earnings and earnings components.
From the users' point of views, earnings and their components are overpriced and considered in predictions. This could indicate that the market is not adequately aware of the persistence of earnings and the components of current earnings in future profitability.
Knowledge acquisition: Today, accounting information systems play a very important role in the workflow of organizations. They have a pivotal role in the economic environment of the countries. Any type of research on how accounting information influences the broad range of decision-makers in companies helps to better understand the role of this information and the need for more and better disclosure of it. The findings of this study emphasize the importance of accurate analysis of the persistence and pricing of earnings, accruals, and operating cash flows when assessing the financial performance of companies.

The present study intends to evaluate the ability of operating cash flow, net income, and earning components in forecasting future cash flow. In this regard, three hypotheses have been formulated. The first hypothesis compares the power of operating cash flow with net profit in forecasting future cash flows. The second hypothesis addresses the income as accrual and cash components and evaluates the effect of these two components on the explanatory power of income. In the third hypothesis, all accruals are divided into their components, namely, discretionary and non-discretionary accruals, and the forecasting power of income is evaluated based on this division. For estimating the research models, the financial information of 107 companies spanning from 2007-2015 was investigated through panel data analysis. The study results showed that net income better forecasts future cash flow compared to operating cash flow. Moreover, the results indicated that the explanatory power of net income in predicting future cash increases upon dividing the earning into its components, namely, cash and accrual components. However, the division of accruals into discretionary and non-discretionary components cannot increase the explanatory power of earning.

The main players in each country's economy are businesses that play an important role in economic growth. Thus to achieve the desired goals, managers should organize their source of finance. Companies, for being in global competitiveness, have to invest in substruction, technology and R&D so that they can develop and promote theirs products and improve their performance. In this study, the cost of R&D on corporate performance is evaluated, using the indicators of operating profit, operating cash flow and economic added value to evaluate the performance of companies. The data of 63 listed companies in Tehran Stock Exchange were selected for the period from 1386 to 1392 to test the hypotheses, and methods of generalized least squares and combined data were used. Results indicated that the cost of research and development and the company's performance using the measure of operating profit does not show a significant relationship. But research and development costs and economic add value indicated a positive impact on the standards of operational cash flow.

One of the main objectives of financial accounting is to provide information for financial analysts to decide on economic issues. Loss firms’ investors are always faced with this decisions to continue or leave their investment in the loss firms. These decisions are directly affected by their assessment of likely to be profitable loss firm in future periods. This study aims to develop a model of the loss reversal, through which can be calculated the possible to profitable loss reversal with information disclosed by listed companies in Tehran Stock Exchange. In particular, weve tested the accuracy of prediction adjusted models loss reversal to the level of its effectiveness to be invoked as a tool to analyze the financial statements.
Research Hypotheses: H1: The likelihood of loss firms becoming profitable in the following period is negatively associated with firms’ reported level of specialized investment assets.
H2: The likelihood of loss firms becoming profitable in the following period is negatively associated with firms’ past and current level of accounting conservatism
The JP model was adopted and extended in order to examine the hypotheses. Specifically, variables measuring loss firms’ investment in specialized assets, capital expenditures and level of accounting conservatism were included in the JP model as additional explanatory variables. The modified JP model models one-year-ahead loss reversal on current and past accounting information. It is stated as follow:

Results indicate that a particular investment is likely to make the company experience a further loss of continuity. Accounting conservatism, as well as a regular feature of financial reporting, is positively related to future loss reversal.
Discussion and Investors of loss firms face abandonment decision based on their assessment of the probability of future loss reversal. This research examined factors that are associated with the likelihood of future loss reversal for Iranian loss firms.
This research has several implications. First, Iranian investors can adopt a set of accounting factors developed in the literature to assess the likelihood of future loss reversal in the Iranian market. These factors cover loss firms’ past performance, loss patterns, dividend payment and reported tax items. Second, given the high incidence of loss firms that are investment intensive (Darrough and Ye, 2007; Wu et al., 2010), loss firms’ investment activities indicating the different stages of investment may be exploited in assessing the likelihood of future loss reversal. Investors should consider lowering their expectation.
Given the prevalence and diversity of loss firms in the Iranian market, future research can expand the set of factors useful in predicting future loss reversal. The current research examines the probability of loss reversal. Future research can investigate the probability of loss reversal in the longer term.
This calls for the development of industry specific loss reversal models in future studies. Another possible research direction relates to investors’ expectation of loss reversal. As shown in prior literature, there are factors such as analyst coverage that could potentially mitigate the underestimation of loss persistence. Future research can explore this arena.

Managers should use a perfected combination of various financial resources based on the elements effective on financing, so that it would result in increase of stockholders wealth and reduce the cost of financing. Among the factors affecting the financing, the operating cash flow, financial constraints and inflation considered effective. The objective of this study is to evaluate the effect of operating cash flow on external financing by considering the effect of the financial constraints and the inflation. The sample of this study consists of 117 companies listed in Tehran Stock Exchange for the period 2005 to 2013 (1384 to 1392 Iranian calendar). To test study hypothesizes, multivariable regression model to panel data was used. The result of this study shows, there is negative and meaningful relationship between operating cash flow and external financing in both of financially constrained and financially unconstrained firms and the Intensity of this relationship is less in the firms with financial constraint. Also the inflation variable increases the effect of cash flow on external financing and this effect is less in firms that have financial constraint.

One of the most important purposes of financial reporting is to provide some information about the company’s performance which is measured by earnings and its components. Therefore, this study was designed to evaluate information on earnings and its components in order to clarify the market value of the companies listed in Tehran Stock Exchange. To this end, the information of 88 companies from 1383 to 1390 (a period of eight years) was studied. The results drawn from testing the research hypotheses revealed that accruals and cash flows had a significant correlation with the companies’ market value. Among the earnings’ components, accruals provide more information for explaining the companies’ market value in comparison with operating cash flow. The other result of this study suggested that non-discretionary accruals had more information content compared to discretionary accruals. Moreover, the overall result indicated that regarding the prediction of companies’ market value, the explanatory power of the earnings’ components was greater than that of the mount of earnings.

Because of specific characteristics of companies in specific industries such as construction industry, whose operation cycles are usually more than one fiscal year, there are different methods and policies for revenue recognition. Errors in accounting estimates in specific industries reduce the usefulness of accounting information. It makes reported profit in the financial statements vary from actual earnings and consequently causes volatility in companies’ stock prices. In this research we examine Specific Factors Affecting Earnings Quality and Stock Prices in Construction Industry. In this regard, a sample of 126 manufacturing companies and 11 Construction companies listed in Tehran stock exchange over the period of 2007- 2012 have been selected. In this study two main hypotheses and two subhypothesis to intensification the reliability were developed. The first main hypothesis results show Earnings response coefficients in Construction companies are weaker than manufacturing companies. The result of the second main hypothesis shows there was no significant difference between stock prices after general assembly and stock prices before general assembly because of dividends or other factors. The first sub-hypothesis results shows operating cash flow can bepredicted by operating profit in Construction Companies, but the adjusted coefficient determination indicate the relationship is too weak. The second subhypothesis results indicate nonlinear relation between stock prices and earnings per share. The main result of this research shows that in pricing of Construction Companies in capital markets, dividend factor is much weaker than other companies’ share pricing, and so other factors like net current asset value, replacement cost and etc play significant role in pricing.

While some of the modern performance measures used in accounting rely on cash flow, others try to take advantage of the information content of net income. However, whether the additional information content in the accrual components of earnings improves the internal performance measurement is an open empirical question. Conceptual framework of this paper based on agency costs and political costs. So that, firm size and information environment are tow important factors in value relevance of net income and operating cash flow. The main purpose of this study is to investigate interactive effect of firm size and information environment on value relevance of net income and operating cash flow. The sample of this study is selected from companies listed in Tehran Stock Exchange (TSE). The study period is between the years 2008 to 2013. The sample consists of 100 companies. To test the research hypotheses regression models using pooled data are incorporated. The results show that net income has more additional and incremental information content than operating cash flow to explain performance of stock market; but firm size and information environment have no effect on value relevance of net Income and operating cash flow. According to the results, we find that, there are not interactive effect of firm size and information environment on value relevance of net income and operating cash flow.

Some incentives and firm characteristics can induce the managers that manipulate operating cash flow and this can causes that they involve in activities that can lead to incorrect allocations and threat shareholders wealth in long-term. This research provides evidence in relation with operation cash flow management and the role of firm characteristics on operating cash flow management. These characteristics include financial distress، debt cost and higher associations between stock returns and operating cash flow. Then، for hypothesizes test، by collection of financial data in 1387 to 1391 years about 80 listed companies in Tehran securities and exchange، we used of regression analysis. Results of research show that، in studied firms in Tehran stock exchange، when the firm is distressing، managers have incentives to manipulate cash flow for showing a good position. But، debt cost and higher associations between stock returns and operating cash flow are not effective incentives for managing the cash flow.