Investigation of Important Factors on Risk of Financial Bankruptcy, Conditional Conservatism beside or vis-àvis Accounting-based Earnings Attributes

In the age that firms deal with various challenges, financial safety and the Factors which end with recession are of great importance. Along with the fact mentioned, the present study considers the investigation of the effect of conditional conservatism and accounting-based earnings attributes on risk of bankruptcy in Firms Listed at the Tehran Stock Exchange. The Z’altman is used for measuring the risk of bankruptcy and accruals quality, earnings persistence, earnings predictability, and earnings smoothness used for measuring the Accounting-based Earnings Attributes.The results of estimating of research hypotheses using the panel data techniques in eviews software for 126 firm of Tehran’s Stock Exchange during a period of five years from 2010 To 2014, suggest that not only using the accounting conditional conservatism does not make any important change in decreasing of risk of bankruptcy, but also it is able to increase the financial distress of Iranian firms. Also, the result show the significant negative relation between the accounting-based earnings attributes (Accruals quality, persistence and predictability) with risk of bankruptcy of firms. Generally, The results reveal that risk of bankruptcy of firms are mostly influenced by economical condition of the country, the politics of financing, the size of the firms, the sort of industry ,and improvement of accounting-based earnings attributes rather than conditional conservatism approaches.