Journal of Accounting and Management Vision

Journal of Accounting and Management Vision

An Empirical Study on the Relationship Between Earnings Management and Auditor’s Opinion: The Moderating Role of Ownership Structure in Firms Listed on the Tehran Stock Exchange

Document Type : Original Article

Authors
1 Assistant Professor, Accounting Department, Khayyam University, Mashhad, Iran.
2 Master of Accounting, Khayyam University, Mashhad, Iran.
Abstract
In today's world, with the expansion of business activities and the growing volume of data, the separation of ownership and management—and its consequences such as conflicts of interest and information asymmetry—has become inevitable. One of the key mechanisms to mitigate this information gap is the audit of financial statements and the issuance of an auditor’s opinion, which can inform stakeholders about managerial actions and the firm’s financial condition. This study investigates the relationship between earnings management and the auditor’s opinion, with an emphasis on the moderating role of ownership structure in companies listed on the Tehran Stock Exchange. The statistical population includes 132 firms over the period 2018 to 2022 (a total of 660 firm-year observations). Data analysis was conducted using multivariate regression models with panel data. The results reveal a significant relationship between earnings management and the issuance of a qualified auditor’s opinion at the 1% significance level; specifically, higher levels of earnings management are associated with an increased likelihood of receiving a qualified opinion. Furthermore, this positive relationship is confirmed in firms with institutional and governmental ownership, where an increase in earnings management leads to a higher probability of receiving a qualified auditor’s opinion.
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