Comparative analysis of the effect of performance criteria and monitoring TZ and Jones Earning Smoothing Models (RELIEF LARS - Variable Selection Approach)

The phenomenon of profit smoothing is a common subject at the frontier of accounting and finance knowledge. One of the incentives for companies to mitigate profits is to minimize tax effects over time. One of the issues involved in the analysis of the factors affecting profit smoothing is the appropriate benchmark for the recognition of profit smoothing. In this research, a comparative analysis of the TN, JONES profit smoothing model was presented. The purpose of this study is to find out whether there is a difference between the profit smoothing indicators from the viewpoint of monitoring and performance with the use of Rilef and Lars alternatives. This study uses information of 150 companies during 7 fiscal years (2012-2018) in Tehran Stock Exchange to compare the effect of regulatory and functional measures on two earnings smoothing indicators. . The results show that the Rilf and Lars performance factors have a higher impact on the two indicators of tz and jones than the regulatory criteria. In general, it can be concluded that by changing the profit smoothing index and the method of selection, there is no significant difference in the impact of effective indicators, although the change in the method of affecting the impact of small indicators has little effect.