The Effect of audit quality on Information Asymmetry of Listed Companies in Tehran Stock Exchange

This study investigated the effect of audit quality on Information Asymmetry in Tehran Stock Exchange. To determinate of auditor quality, using three metrics of Auditor firm , Auditor Tenure and Adjusted Jones model , and Bid-ask spread, we use for measure of Information Asymmetry. In this study, we investigated the listed companies in Tehran stock exchange, over the period of 2005-2011. The method used in this research for testing the hypothesis is panel data.The result on the basis of the 126 companies of Tehran stock exchange, and using data regression method with Eviews program, shows that auditor quality and Auditor Tenure have positive effective on Information Asymmetry and Information Asymmetry increase with increasing in each of them. Also the results show that there is a negative relationship between Auditor firm and Information Asymmetry, and when the audit is carried out by the audit organization decreased the amount of Information Asymmetry.