Iranian Journal of Accounting, Auditing and Finance in the Islamic Environment

Iranian Journal of Accounting, Auditing and Finance in the Islamic Environment

The relationship between financial reporting transparency, audit quality and stock price crash risk in Islamic environments

Document Type : Original Article

Authors
majid moradi 1
morteza ghaem panah 2
1 Assistant Professor, Department of Accounting, Islamic Azad University, Saveh Branch, Iran
2 Master's student in accounting at Nasser Khosrow Saveh Institute of Higher Education
10.22034/aafie.2025.475312.1050
Abstract
The present study was conducted to investigate the relationship between financial reporting transparency, audit quality and stock price crash risk in Islamic environments. The statistical population of this study is all companies listed on the Tehran Stock Exchange during the years 2011 to 2021. The multivariate regression method was used to test the research hypotheses. The research method is inductive-deductive in which theoretical foundations and research background were collected through the library, articles and the Internet, and the research hypotheses were rejected or proven by using appropriate statistical methods to generalize the results. Financial data was collected in Excel software to form a database and then analyzed using IViews software to test the research hypotheses. The research results showed that there is a significant and positive relationship between financial reporting transparency and crash risk. Lack of transparency of financial information increases the possibility of a sudden influx of bad news into the market and, as a result, the risk of stock price crash. Also, lack of transparency in financial reporting has a significant and inverse relationship with audit quality.
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Iranian Journal of Accounting, Auditing and Finance in the Islamic Environment
Volume 2, Issue 6 - Serial Number 6
Summer 2025
Pages 78-108

  • Receive Date 26 August 2024
  • Revise Date 18 January 2025
  • Accept Date 13 February 2025
  • Publish Date 23 August 2025