Journal of Accounting and Management Vision

Journal of Accounting and Management Vision

Investigation of the effect of board independence on the relationship between financial constraints and financial statement restatement in manufacturing companies accepted in the Tehran Stock Exchange.

Document Type : Original Article

Authors
sedigheh tabe matoghi 1
hassan ahmadi 2
1 Master’s Degree in Financial Management, Kherad Institute of Higher Education, Bushehr, Iran.
2 Department of Accounting, Kherad Institute of Higher Education, Bushehr, Iran.
Abstract
This research examines the effect of financial constraints on financial statement restatements and the moderating role of board independence in this process. The primary objective is to analyze how financial constraints influence the likelihood of financial statement restatements in manufacturing companies listed on the Tehran Stock Exchange.The study employed panel data analysis using information from 120 manufacturing companies listed on the Tehran Stock Exchange from 2017 to 2023. Logistic regression and other statistical models were used for data analysis.The findings indicate that financial constraints have a significant positive impact on financial statement restatements, particularly in companies with high debt. Furthermore, board independence acts as a moderator, mitigating the negative effects of financial constraints. Independent boards, through more rigorous oversight, can prevent financial manipulation and enhance transparency in financial reporting. These results emphasize that strengthening board independence can help prevent financial statement restatements caused by financial constraints.
Keywords
Financial constraints
financial statement restatement
board independent

Subjects