The Effect of Management Characteristics on Audit Report Readability

The present study investigates the relationship between management characteristics (managerial entrenchment, CEO narcissism, overconfidence, board effort, real and accrual-based earnings management) audit report readability of listed firms. In other words, this paper seeks to answer question “whether can have a favourable effect on or not.” multivariate regression model is used for study. Research hypotheses were also examined using sample 1004 observations Tehran Stock Exchange during 2012–2018 by employing multiple patterns based panel data technique fixed effects model. results show negative significant managerial entrenchment readability, FOG index, positive effort index. Moreover, exists management, text length Flesch indices. A was evident narcissism same Besides, research models more confidence additional methods, including FE, T + 1, ABB, GMM, which confirm study’s preliminary results. Since first investigate such topic in emergent markets, it provides valuable information about intrinsic acquisitive users, analysts, legal institutions that contribute significantly financial statement readability.