Association between Capital Structure and Accounting Conservatism in Iranian Stock Market

Abstract

The present study intends to investigate the relation between capital structure and accounting conservatism according to operating and book procedures. It is an applied and correlation research which used a sample of 100 listed companies on Tehran Stock Exchange during a period of two years from 2008 to 2009. Regression model and descriptive statistical methods were applied to appraise hypotheses. Finally, correlation analysis was accounted among variables. The findings of the research indicate that the hypotheses are rejected and there is no significant relationship between capital structure and operating and book conservatism. This paper extends the existing literature especially relating to all decisions about capital structure and its impact on firms’ value.

Keywords: Capital Structure, Operating Conservatism, Book Conservatism, Iran