The Impact of Audit Committee Characteristics and Audit Fees on Classification Shifting of Items in the Income Statement: Evidence from Iran

classification shifting of items in the income statement is one of the management strategies for earnings manipulation and management. The presence of regulatory factors to control financial reporting and ensure its health is necessary. The current research has investigated the effect of audit committee characteristics (size and financial expertise of members) and audit fees on the classification shifting of items in the income statement. To achieve this goal, 1052 company-year observations (208 companies) collected from the audited financial reports of companies admitted to the Tehran Stock Exchange from 2013 to 2022 have been examined. The results of the research, in addition to confirming the use of stock exchange companies of classification shifting for earnings management, show that there is a negative and significant relationship between audit fees and the increase in the financial and accounting expertise of the members of the audit committee with the classification shifting of items in the income statement; But there is no significant relationship between the size of the audit committee and this strategy.