Authors : Ebrahim Mehrabani, Mohamad Reza Shoorvarzy and Mohammad Karimi
Abstract: According to the standard 6 of Iranian accounting standards when accounting procedure changes (if necessary), former comparative annual figures must be restated based on the new procedure. Also sometimes it is possible that published financial statements for one or several former periods include important errors in a way that a wrong image to be represented, then the reliability of such financial statements may be decreased. For correcting such errors it is necessary that financial statements for former year or years to be restated. The purpose of this study is examine the effect of the change in board of directors on the relation between audit fee and the restatement of financial reports for listed companies of Tehran stock exchange. The present study is a descriptive-applied one which is based on the periodical data of 136 companies listed in the TSE from 2009-2014. The multivariate regression is used for examination of the relation of each effective factor to audit fee and financial restatement. The findings state that there is a significant relation between the change in the board of directors’ members and the restatement level of total asset at the 95% confidence level. Also it is appeared from the findings that change in board of board can’t affect audit fee. The determination coefficient obtained for the above relation shows that independent variables can only explain a part of financial restatements and investors must consider other factors when are examining this matter.
Ebrahim Mehrabani, Mohamad Reza Shoorvarzy and Mohammad Karimi, 2017. The Effect of the Changes in Board of Directors on the Relation Between Audit Fee and Financial Restatements. International Business Management, 11: 237-244.