Document Type : Original Article
Ph.D Student, Department of Accounting, Science and Research branch , Islamic Azad University, Tehran, Iran
Associate professor, Department of Accounting, Science and Research Branch, Islamic Azad University, Tehran, Iran.
Professor, Department of Accounting ,Central Tehran branch, Islamic Azad Universit, Tehran, Iran
Earning is one of the most important accounting information as well as a criterion for assessing financial reporting and has always been considered by the various interest groups in the company. Because the change in the balance sheet figures occurs due to the change in the profit and loss statement figures. The existence of an accrual accounting basis has led investors and financial analysts to focus on the quality of their earnings in addition to reported earnings values in determining the company's value. Hence, earnings persistence is one of the important indicators of earnings quality. From the perspective of investors, the earnings that is more stable, the earning is defined by the quality. Therefore, managers as top-level organizations have the power and authority to make decisions and influence financial reporting. As a result of their opportunistic behavior with excessive earning manipulation and confidence, they rely on their own beliefs to reduce their reliance on information and reduce the quality of earning. In this regard, the present study first explores the relationship between the Earnings forecast error and earning persistence in earning management. Then, in the following, the effect management overconfidence on the above relationship has been examined over a 9-year period from 2009 to 2017 in 115 companies from listed companies in Tehran Stock Exchange. The results of this study show that there is a significant and positive relationship between Earnings forecast error and the earning persistence in earnings management, also the overconfidence has a different significant effect on them.