Investigating the Impact of Corporate Governance Features as Monitoring Mechanisms on True Profit Management

The purpose of this research is to investigate the relationship between the mechanisms of corporate governance and earnings management in automotive industry and its components in Tehran Stock Exchange. To achieve the research objectives, six hypotheses have been developed that test the significance of the relationship between the mechanisms of corporate governance and corporate profit management. The research sample consisted of 28 companies during the period of 1391-2014. The statistical method used to test the hypotheses is linear regression. Also, for the correlation analysis between independent variables, the co-linear test was used. The results of hypothesis testing indicate that there is a significant relationship between some of the mechanisms of corporate governance (institutional ownership, size of the board, the ratio of the presence of unaudited members in the board of directors) and the lack of a significant relationship between the size of the audit firm (independent auditor) and the auditor Permanent (internal) with profit management.