The main objective of this study is to investigate the relationship between earnings management and managerial overconfidence in listed firms on the Tehran Stock Exchange. This study has attempted to answer the question as to whether that overconfidence from the chief executive officer can impact firm's earnings management. To answer the question of this study, we have investigated 915 year-firm observations from listed firms on Tehran Stock Exchange from 2004-2014. Data analysis and hypothesis testing was performed by using binary logistic regression. The results confirmed that as managerial overconfidence increased, then the earnings overstatement will increases. In addition, the results indicated that there is a significant and negative correlation between debt ratio and size of the firms with maximization of earnings management.

Overconfident managers overestimate future returns from their firms’ investments. Thus, it is predicted that overconfident managers will tend to delay loss recognition and generally use less conservative accounting. This paper is concerned with the relationship between Accounting Conservatism and Managerial Overconfidence, and the effects of external monitoring on this relationship. The sample contains 62 firms over the period 1378–1391. The results indicate a negative relationship between managerial overconfidence and both the conditional and unconditional conservatism. In addition, the result provides evidence that external monitoring appears to mitigate the negative effect of overconfidence on conditional conservatism, but does not appear to have the same effect on unconditional conservatism.

Overconfidence or excessive self-confidence in general can be defined as a groundless belief about individual's cognitive abilities, judgments and intuitive reasoning. If the auditor recognizes these personality traits in managers and estimates the financial reporting risk to be excessive due to managerial overconfidence, he/she could demand higher audit fees to compensate for the additional audit efforts needed to reduce detection risk. On the other hand, due to the confidence in their firms' financial reporting process, the overconfident managers choose negotiation as a way to demand less scope and pay lower fees to the auditors. This study aimed to investigate the effect of managerial overconfidence on audit fees. The statistical population consisted of firms listed on the Tehran Stock Exchange during the years 2007 to 2013. The results indicated a significant negative relation between managerial overconfidence and audit fees. The additional studies showed that managerial overconfidence has no significant impact on using industry specialist auditors.

Overconfidence is one of the most important personal characteristics of managers. Theoretically, Manager’ s riskiness is directly related to this characteristic. The Possibility of unqualified opinion increases, if the auditor recognizes this personality trait of the managers and overestimates financial reporting risk due to Managerial Overconfidence. This study is aimed to determine the relationship between Managerial Overconfidence and Unqualified Audit Opinion in firms listed in Tehran Stock Exchange. This research uses the library research to collect theoretical basics and data and applies correlation method to test the hypothesis. The statistical population includes all listed companies in Tehran Stock Exchange and the sample consists of 66 companies during the period from 2007 to 2014. The logistic regression method is used to test the hypotheses of the research. The results show that Managerial Overconfidence has significant and negative relationship with Unqualified Audit Opinion. That means any increase of Managerial Overconfidence decreases the possibility of Unqualified Audit Opinion.

Corporate investment decisions are determined by a variety of factors, including various managerial measures, including overconfidence of managers, which are important determinants of corporate investment decisions. Most corporate executives prefer internal financing, but if internal resources are not sufficient to meet this need, they use external resources with the least degree of information asymmetry. The purpose of this study was to investigate the effect of managerial overconfidence on investment and the moderating effect of the internal financing method is on their relationship. The study consisted of listed companies in Tehran Stock Exchange during the period 2011 to 2016 and using a systematic elimination sampling method, 97 companies were selected. To investigate the research hypotheses, EVIEWS software and panel data regression method was used. The results of the research showed that managers’ overconfidence has a positive and significant effect on investment as well as underinvestment, but internal financing does not have a significant effect on the relationship between the overconfidence of managers and investment as well over-investment. But the effect of internal financing on the relationship between managers’ overconfidence and underinvestment was a significant positive. Finally, it became clear that internal financing had a significant negative impact on investment and over-investment.

Managerial cognitive biases, particularly managerial overconfidence, have always been influential factors on the research and development and innovation processes of firms. The present study thus aimed to investigate the impact of managerial overconfidence on research and development expenditures of firms. To this end, managerial overconfidence was proxied by two measures based on investment decisions. The research hypothesis was also built upon 51 firms listed on the Tehran Stock Exchange over the period of 2012-2016, and then tested using multivariate regression model based on panel data. The findings revealed that managerial overconfidence tends to enhance research and development expenditures.

The purpose of the current study was investigating the effect of managing director`s overconfidence on financing policies and investment efficiency in Tehran stock exchange. The statistical population of this study included listed companies in the Tehran stock exchange and its statistical sample included the data of 139 companies during 2011-2018, for seven years. The methodology of this research was done through systematic deletion and the method used for estimating the pattern was multivariate regression method using the estimation of integrated data having constant effects. The results showed that overconfidence of managers had a reversed and significant effect on the investment efficiency and it had a direct and significant relationship on over-investment. Moreover, more investigations showed that in case company managers have access to internal financial resources, they would tend to have over-investments,however, financing from resources outside the company would lead to under-investment. Therefore, managers` overconfidence, as a characteristic feature, affected their financing decisions and investment. Most of these managers have boldly behaviors due to overconfidence on their own decisions which may lead to taking non-optimal decisions regarding the investments so that through increasing over-investments, it may lead to a reduction in the investment efficiencies of the companies.