Investigating relationship between earnings management and information asymmetry of firms listed in Tehran Stock Exchange

Byearning management, it is believed that investors are trying to pay more attention to purchase of shares from firms that have a pattern of earning growth. Evidence suggests that when firms violate earnings growth, stock values drop significantly. Managers of firms that have a earning growth pattern over the years, have had some ways to continue reporting the increase of earnings in each period, which is one of the ways to lower earnings when raising and also raising earnings when it's down. The main purpose of this research is to investigate the relationship between earnings management and information asymmetry of firms listed in Tehran Stock Exchange. For this purpose, 106 firms have been selected from Tehran Stock Exchange during 2008–2016. The findings of this research show that earnings management does not affect the number of trading days as a reciprocal measure of information asymmetry, and the results are obtained by controlling the size of firm's variables.