The impact of auditor conservatism and audit firms' ranking on earnings management based on accruals

The present study examines the impact of auditor conservatism and the rating of auditing firms on profit management based on accruals. This research is applied in terms of purpose and in terms of methodology, correlation is a type of causal (post-event) research. The statistical population of the study was all companies listed on the Tehran Stock Exchange, which were systematically eliminated by 117 companies as a sample of selected research and surveyed over a period of 5 years between 2014 and 1397. Modified Jones model was used to measure the profit management variable. The method used to collect information is library and multiple linear regression has been used to test the hypotheses. Stata version 15 software was used to run the tests and estimate the models. The research results show that auditor conservatism does not affect the management of interest based on accruals. Ranking of auditing firms has a negative impact on profit management based on accruals. In other words, in companies whose audits are performed by top-ranked institutions, profit management based on items has less commitment.