Investigating the relationship between financial reporting quality and stock portfolio returns: growth or value ?

The purpose of this study was to investigate the relationship between financial reporting quality indicators and growth returns and value stocks experimentally. The quality of financial reporting is measured using four criteria: quality of accruals, accuracy of financial information, discretionary accruals and discretionary income and stocks are divided into growth and value using the return on assets. Also, company size, leverage ratio and equity return as control variables were included in the research model. The research sample includes 120 companies in the period from 2011 to 2018. The results obtained using logistic regression indicate that All four criteria of financial reporting quality including the quality of accruals, accuracy of financial information, discretionary accruals and discretionary earnings have a significant relationship with growth and value of stock returns. In a way that with the increase in the quality of financial reporting, the stock returns of companies have been driven to growth.