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<div><p><em>The aim of this paper is to study the relationship between earnings management, governance and investors </em><em>behavior</em><em>, since this latter can inform about the nature of earnings management and can be considered as a governance mechanism to reduce accounts manipulations. On the basis of a sample of 700 American firms for the period of 1996-2006, our empirical results show that </em><em>investors who take short positions, are able to interpret the information detected from the earnings management. The activity of these investors may be considered as an indicator of the quality of the governance structure and the presence and nature of earnings management. The under-reaction of investors to information leads to short-term sale of the shares of poorly governed firms and characterized by an opportunistic earnings management and to invest in firms well-governed and characterized by an informational earnings management therefore an abnormal profit can be realized.</em></p></div>

In present study by virtue of the importance of  the fiscal statement contents and illiquid items ignored by the merchant the depreciation contents relation with abnormal return of the shares and future benefits are examined in order to influence the items under consideration of the investors to take related decisions; 94 companies were selected from the accessible universe in five years (2006-2010) to have the data necessary for the study in order to achieve the goal & with the base of keeping attention to the manufacturing & nonmanufacturing companies in the whole industries of stock market except banks & insurance companies. The simple and multivariable regression statistical techniques Chow and Hausman Test were used to test the hypotheses. The significant test was conducted for the paradigms by using the ‘F’ and ‘T’ statistics. The study findings show local high inflation have affection on the both variable results & makes no relation for first variable,for future benefits shows parallel  movements.

<p><em>In this paper, we examine the impact of CEO power on auditor choice. We are motivated by the competing financial reporting incentives arising from CEO power. Our empirical finding suggests that powerful CEOs are more likely to hire high-quality auditors as a signal of superior financial reporting quality. We contribute to the literature of auditor switch and extend the research on the links between CEO power and firm behaviors.</em></p>