This paper surveys some aspects of overinvestment and underinvestment hypothesis. On the base of this hypothesis, Free Cash Flows (FCF) at the result of information asymmetry between managers and shareholders, lead to overinvestment. Also, Financial Constraint (FC) cause to underinvestment. This paper investigates relation between FCF and overinvestment & relation between FC and underinvestment in Tehran Stock Exchange (TSE), s corporations. Results suggest that, there is a positive and significant relation between FCF and overinvestment. Nevertheless, this paper shows, the relation between FC and underinvestment, statistically is not significant.

Introduction: The main purpose of this study is to investigate the relationship between accounting conservatism and investment efficiency, to inform managers, investors and professional accounting bodies about the good quality of accounting conservatism as a qualitative characteristic of accounting information. Conservatism is expected (1) to improve the monitoring process over managerial investment decisions, decreasing investment in settings where managers are likely to over-invest, and (2) to facilitate the access to external financing at lower cost, increasing investment in settings where managers are likely to under-invest…

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.

This is an empirical investigation on the relation between investment efficiency and financial reporting quality, which is based on Verdi (2006) model. Investment efficiency in a conceptual framework means the acceptance of the investment projects with positive NPV, and investment inefficiency means rejecting these investments opportunities (underinvestment) or investing in projects with negative NPV (overinvestment). In this paper, expected investment is a function of growth opportunities. Overinvestment and underinvestment is a sign of investment inefficiency. For evaluating the financial reporting quality, we used the accruals quality model. This paper investigates the subject matter in 152 companies at TSE (Tehran Stock Exchange) in 1379 to 1387 time period. The evidences suggest no association between those variables.

In perspective of agency theory, the financial reporting quality and debt maturity can moderate information asymmetry and thus affect investment efficiency. The study investigates the interaction of quality financial reporting and debt maturity on investment efficiency (reducing underinvestment and overinvestment) in Tehran Stock Exchange listed companies. The financial reporting quality has been measured through the three indexes and regression models used to examine the association. The findings suggest that financial reporting quality of the firms with underinvestment cause to increase willingness to investment and therefore improve their investment efficiency. Less debt maturity has similar effect on theses firms. Moreover, the impact of financial reporting quality on reduction of underinvestment is strong for firms with lower debt maturity.

The purpose of this study is to test the effectiveness of VAT on the investment efficiency in listed companies in Tehran Stock Exchange. In this regard, 140 companies (980 observation year-companies) accepted in the Tehran Stock Exchange during the period from 2011 to 2017 have been investigated. In order to test the hypotheses of the research, a multiple linear regression model was used using combined data (integrated method). The results of this research indicate a negative and significant effect of the value added tax on the investment level of the company. Also, the research results showed that value added tax has a positive and significant effect on investment efficiency. In addition, the results of the research showed that the value added tax has a negative and significant effect on overinvestment and underinvestment and increases the investment efficiency. These results point to the importance and effectiveness of value added tax in acquiring an unconnected and efficient investment for the company.

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.

One of the most important principles of corporate governance, the CEO of the Company on the Company's operations and results could be the different ways it affects. One of the current discussions on the theme of the CEO, focused on the issue of the CEO reputation. The goal of this research is evaluating the effect of CEO reputation on relationship between agency costs and cumulative abnormal returns in firms over(under)investment. In this research, information was collected from company listed in TSE during 1383 -1391. capital investment ratio as the indicator of measuring over(under)investment, free cash flow and interaction between growth opportunities and free cash flow as the indicators of agency costs. research method was descriptive correlation and for hypothesis test of method pooled Least Squares . the research finding show the negative and significant relationship between agency costs and cumulative abnormal returns and effect CEO reputation and factors(CEO Tenure, CEO outsider, CEO perform) on the relationship are positive and significant.