Internal Control Weakness and Accruals Quality in Companies Listed on Tehran Stock Exchange

This paper investigates the relation between internal control weakness and accruals quality using data obtained from 200 companies listed on Tehran stock exchange between 2008 and 2013. We conduct correlation analysis to determine whether internal control weakness is associated with accrual quality or not. Are the internal controls designed to ensure the validity and reliability of the accounting information system and prevent deviations in identification of accruals? We estimate internal control weakness and accrual quality separately; then to test research hypothesis correlation coefficients was measured. The results indicate that accruals quality is very strongly associated with the internal control weakness and indeed, quality of accounting information (accruals) is highly dependent on both providing information environment and information resources. According to prior research in companies with high internal control weakness, will present reduced financial information quality (C) 2015 The Authors. Published by Elsevier Ltd.