The Effect of Managerial Ability on Earning Quality of Listed Companies in Tehran Stock Exchange

The main purpose of this article is to examine the effect of management ability on earnings quality. To coduct this study، financial reports of 92 companies during the financial periods of 2002 to 2010 are used. Management ability is measured by DEA method and eanings quality is measured by three criteria that are: eaning restatement، eaning stability and the quality of accruals items. The results of this research show that management ability generally has a positive and meaningful effect on eanings quality. The results also show that high ability of management causes more stability of earnings and a better quality for accrual items but a meaningful relationship between management ability and the criterion of eanings restatement was not found.