Mehdi Nazemi 1, Ali Kiyaie 2, * Department of Accounting, Damghan Branch, Islamic Azad University, Damghan, Iran 2

Transcription

1 The Relaionship beween Conrol Levels, Financial Consrains and he Raio of Research and Developmen Expenses he Companies Acceped on he Tehran Sock Exchange Mehdi Nazemi, Ali Kiyaie, * Deparmen of Accouning, Damghan Branch, Islamic Azad Universiy, Damghan, Iran Deparmen of Accouning, Tehran Eas Branch, Islamic Azad Universiy, Tehran, Iran ABSTRACT The aim of his sudy was o evaluae he relaionship beween levels of conrol, financial consrains and he raio of R & D expendiures lised companies on he Sock Exchange in Tehran. This sudy, sudy, library and scienific analyical and based on panel daa analysis (panel daa) is. In his sudy, financial firms lised in he Tehran Sock Exchange during he period 388 o 393 (6 firm - years). To analyze he resuls of he sudy were Eviews 7 sofware. The innovaive aspec of his research is any research has been done on his subjec in he Tehran Sock Exchange wih respec o he period from 388 o 393; he new research. The resuls in relaion o he firs hypohesis suggess ha financial consrains and he volailiy of he raio beween R & D spending significan inverse relaionship exiss. Also according o he analysis made in connecion wih he second hypohesis, we found ha he level of insiuional ownership conrol and dynamics of R & D spending is a significan relaionship. The following resuls in connecion wih he hird hypohesis suggess ha he level of propery managemen and volailiy conrol of R & D spending significan inverse relaionship exiss. Also according o he analysis made in relaion o he fourh hypohesis, he sudy concluded ha he level and volailiy of small shareholders conrol over expenses Research and developmen here is no significan relaionship. KEYWORDS Financial consrains, Volailiy of research, developmen expendiure, Conrol level. R INTRODUCTION esearch and developmen ( any consisen and creaive aciviies o increase knowledge of man, culure, sociey and use his knowledge for new applicaions *Corresponding Auhor: Ali Kiyaie r: Telephone Number r: Fax. Number r: (Beleck e al., 4). In oher words, research and developmen, he process of urning ideas ino new producs and beer qualiy han exising producion (Drobez e al., ). Relaed o he profiabiliy of hese producs o he final consumer or echnology relaed o he manufacuring process. The role of research and developmen on economic growh, o he exen ha i referred o as an imporan variable in he economy. The imporance of research and developmen so ha companies on he basis of research funds from GDP, divided ino developed or underdeveloped. R & D spending in addiion o he mobiliy of populaion growh and economic developmen, enhancing he firm's profis as well. Operaing cash flows arising from cash and cash equivalens by facors such companies can inves in research and developmen of expenses have increased or decreased, As well as addiional cash invesmen in R & D spending could be increased or reduced agency coss, So he quesion in his respec is unclear and here are hings ha need o examine his relaionship in paricular is srongly fel in Tehran Sock Exchange. Insiuional invesors due o he influence and power in he company o conrol he company always wans o symbolize he inrinsic value of heir own asses. Par of he cash flows of operaional aciviy in he new company devoed o R & D expendiure And his from he premise prospecive managers wih he ineress of major shareholders or eniy in connecion wih policy conrol. Lerner and Wolf (6), believed ha companies wih growing cash flows associaed wih he ownership of a significan percenage of shares in he hands of persons confined o a fairly subsanial amoun of research and developmen expendiures in is financial saemens show. There is a direc relaionship beween cash flows and he growh rae of invesmen in research and developmen expendiures from he premise managers, insiuional invesors are under consideraion. 9

2 Companies wih differen moives o heir cash holdings. For example, he difference beween he cos of financing inernal and exernal causes companies o borrow, inves and conrol heir savings o cash in heir ime of need, from is inernal cash flow use. If he company fails for any reason a he righ ime limied access o needed cash, or a "financial consrains" deemed (Almeida e al., 3). BACKGROUND RESEARCH Penman and Levise (5) in a sudy o examine he relaionship beween earnings and cash flows and sock reurns due o heir specific characerisics. The research o help invesors and oher users of he decision-making process, he relaionship beween earnings and cash flows and sock reurns according o specific characerisics in erms of size, deb level and evaluaes he life cycle. The main objecive of he paper is o examine he relaionship beween income, changes in earnings and cash flows and sock reurns wih due regard o specific companies. The resuls showed ha profi more daa o predic sock reurns for corporaions, companies wih high deb levels and provides firms wih no growh. The resuls showed ha profi changes more abou small companies, companies wih low deb levels and provides firms wih no growh. The resuls showed ha more incremenal cash flow informaion for predicing sock reurns for boh small and large companies, corporaions wih high deb and low growh and growing enerprises do no offer. Spriser and Jones (5) in a sudy o examine he relaionship beween earnings and operaing cash flow wih heir sysemic risk. In his sudy, daa on earnings and operaing cash flow was used o predic he relaive abiliy of accouning informaion in he process of sysemic risk be examined. On his basis, he relaionship beween accouning profi and bea bea operaing cash flow during he period 8 o 4 based on a sample of companies from Malaysia sock companies, wih sysemic risk were examined. The resuls of his sudy indicae ha boh earnings and operaing cash flow informaion associaed wih sysemic risk And hus we can say ha he informaion in he forecas sysemic risk wih he informaion conen of accouning earnings and operaing cash flow in he forecas sysemic risk was also examined. The resuls indicae ha informaion on accouning profi (bea earnings) during he period of invesigaion wih respec o informaion relaed o operaing cash flow (operaing cash flow b) in he process of anicipaed sysemic risk has increased conen of informaion. Ricardo (5) in a sudy o examine he relaionship beween free cash flow and cash flow from operaing aciviies and earnings per share in he company's cars. The relaion beween PES cash 5 larges auomoive sandards (in erms of asses) exchange Tysalhay Denmark (4- ) were evaluaed. The resuls showed ha he Haslaz cash flow operaing aciviies per share (as a measure of cash) and earnings per share (as a measure of he marke) here is a significan linear relaionship. Also, Pearson Brrsyhmbsgy beween he parameers of free cash flow raio and liquidiy raio and here is a srong posiive correlaion. Aghai and ohers (393) in a sudy o examine he effec of shocks operaing cash flow and capial srucure of asses of lised companies engaged in he Tehran Sock Exchange. The effec of changes in operaing cash flow due o severe shocks ha are no sysemaically idenified (Momenum funds), asse and capial srucure on manufacuring companies lised in Tehran Sock Exchange consider. This Main componens of cash flow by convering o a simple mahemaical equaion (Eq cash flow) and mulivariae regression model of he equaion esed.. Based on a sample consising of 36 company-years among manufacuring companies lised in Tehran Sock Exchange during he period 86 o 9, he findings sugges ha he change of operaing cash (cash flow of momenum ) and changes in asses and capial srucure here is a significan relaionship, he resuls indicae ha companies in he shor erm o increase savings (increase in cash holdings) and exernal financing (deb reducion or sale capial sock ownership) and increasing invesmen in he long erm o carry ou logic and exernal financing, he allocaion of Company cash flows, represen a reacion (behavior) is he Company's cash flow shocks. Hashemi and Moalebian (393) in a sudy o examine he relaionship beween operaing cash flow of abnormal sock reurns of companies lised on Tehran Sock Exchange began. In order o analyze he daa and regression model was used o esimae he model of financial informaion beween he years 38 o 39 by 8 companies combined daa is used. The resuls of hypohesis esing showed ha a significan and negaive operaing cash flows wih fuure sock reurns are abnormal. Izadinia and ohers (393) in a sudy o examine he relaionship beween cash flow from operaions, ne income and free cash flow of accruals and fuure componens of Tehran Sock Exchange's lised companies. The aim of his sudy was o evaluae he abiliy of ne income and operaing cash flows in free cash flow is prediced. Also, he abiliy o predic he componens of accruals in improving free cash flow is invesigaed. In his sudy, 78 companies have been invesigaed in he period Free cash flow as he dependen variable and ne income, cash flows from operaions and oher accruals as independen variables are considered. For his purpose, univariae and mulivariae regression analysis of panel daa is used. The resuls showed ha cash flows from operaions, compared wih a ne profi of free cash flow is more able o predic. Also, add componens o model accruals improve he predicive power of free cash flow is operaing cash flows. RESEARCH METHOD The mehodology used in his sudy is a correlaion research, descripive research ypes (descripive and correlaional sudy, he researchers examined he relaionship beween wo or more variables). Mehod of reasoning, deducive, inducive. Scalable because as he heoreical framework and lieraure from he library, papers

3 and because he Inerne is used and inducive daa analysis of primary daa pah o accep or rejec he hypohesis done. In his sudy, he ype of daa and mehods of analysis, he mehod of "daa panel" is used. Because in order o sudy he relaionship beween levels of conrol, financial consrains and he raio of R & D expenses, and esimaed predicor variables examined from wo differen aspecs. On he one hand, hese variables among differen firms and on he oher hand, in he period are esed. Model of research: Ln( CM 3 4 C( Cons 5 CG CIns 6 CF ε The models are: i represens he Company (secional unis) and represens he year. ε i, = Random error firm i in year. RESEARCH HYPOTHESES Afer he formulaion of quesions, research hypoheses have been developed as follows: Firs hypohesis: The financial consrains and he volailiy of he raio of R & D coss have a significan relaionship. Second hypohesis: Flucuaions beween he level of insiuional ownership and conrol of research and developmen coss have a significan relaionship. THE STATISTICAL SAMPLES The sudy populaion consised of all companies lised on he sock exchange securiies Tehran. According o he official websie of he Tehran Sock Exchange by he end of 393, all companies lised includes 5 companies in 37 indusry groups, respecively. So in his sudy, all companies lised on he Tehran Sock Exchange during a period of six years, from 388 o 393, populaion of he sudy. RESEARCH MODELS To es he hypohesis, he model will be used as follows.the hear if coefficiens (coefficiens of independen variables) is significan a 95% confidence level, respecively he firs and second hypoheses of he research is approved. DESCRIPTIVE STATISTICS OF VARIABLES In general, he mehods by which i can be processed and summarized daa, called descripive saisics. This ype of daa. The goal is simply o describe he communiy or sample of he populaion parameers or sample is calculaed (Azar and Momen 389, p. 8). The descripive saisics, daa analysis using descripive saisics such as mean, median and sandard deviaion measures he dispersion, skewness and kurosis done. In his connecion, he average of he main cenral index, and average daa shows, so ha if he daa on an axis aligned on a regular basis, he average value exacly balance poin or cener of graviy is disribued. Sandard deviaion of dispersion parameers and he scaering daa show. Skewness of he parameers deermining he deviaion of symmery and asymmery index daa. If you have a communiy of symmerical disribuion, skewness coefficien equal o zero, if he sociey is skewed o he lef, if you have negaive skewness coefficien is skewed o he righ, skewness coefficien is posiive. Elongaion is he measure of he dispersion of he populaion compared o he normal disribuion (he believers and Ghaiyoom 39). Brief descripive saisics of he variables afer he screening and removal of ouliers in Figure is provided. Tab.. Graphic, descripive saisics variables Elongaion Skewness Maximum amoun Lowes Sandard deviaion Average Number of Views Variable /73 /6 6/7 3/3333 3/6 3/63 6 Flucuaions in he coss of research and developmen -/73 3/7 /3333 3/3333 3/7 3/6 6 Financial consrains 3/ 6/7 3/33 3/3 6/7 3/37 6 Conrol he level of insiuional ownership -3/66-3/33 3/77 3/3333 3/66 3/66 6 Conrol he level of managerial ownership -3/6-3/336 3/67 3/3333 3/3 3/6 6 Conrol of small shareholders / /66 6/3 3/7 3/ 3/ 6 Corporae governance index 6/6 6/ /3 3/3337 3/3 3/7 6 Cash flow raio According o Table, he average volailiy of research and developmen expendiure of companies respecively 37/ and / and 759/ is he minimum and maximum amoun equal o. Skewness and kurosis assess

4 hese variables which should be respecively and 3 is normally disribued variables, shows ha his variable is no normally disribued. The descripive saisics presened in Table, he average financial consrains, he level of insiuional ownership conrol, level conrol and managemen dominaed by small shareholders conrol he sample companies during he period of invesigaion, respecively posiive and 456/, 779/, 84 / and 8/ respecively.the posiive average index of corporae governance and of cash flows, respecively 6654/ and 549/ respecively. Tes he normal disribuion of he dependen variable: In his sudy was o esimae he parameers used and he mehod of ordinary leas squares mehod based on he assumpion ha he dependen variable is normally disribued, so ha he non-normal disribuion of he dependen variable leads o violaions of he assumpions of his mehod for esimaing parameers and does no provide accurae resuls. I is herefore necessary o coninue he normal disribuion of he variables esed. One of he assumpions of normaliy of he residuals of he regression model, which reflecs he credibiliy of regression ess, so he normaliy of he dependen variable o model normal residuals (difference beween he esimaed value of he acual values) leads. So i is necessary o esimae he parameers of normaliy of he dependen variable, and in case of non-normal condiion suiable soluion for hem (including conversion of i) would be aken. In his sudy he issue hrough Kolmogorov-Smirnov es (K-S) is evaluaed. In his es he null hypohesis and he alernaive hypohesis is as follows: If he level of saisical significance of he es is more han.5 (Prob>.5) H hypohesis of normal disribuion of he variable will be acceped. The figures K-S es resuls for he dependen variable sample companies provided. If he level of saisical significance of he es is more han 5/ (Prob>.5) H hypohesis of normal disribuion of he variable will be acceped. K-S es resuls in Table for variable damping raio of research and developmen expendiure of companies is provided. Tab.. Normaliy of he dependen variable image resuls Significance level (Sig) 3 /333 Saisic (K-S) / The number (N) 6 Variable Flucuaions in he coss of research and developmen Given he changing dynamics of expendiures for research and developmen, he imporance of KS saisic is less han 5/, The H hypohesis of normal disribuion of he variables was rejeced a 95%, reflecing he changing dynamics of R & D expendiures ha do no have a normal disribuion. In his sudy, normal daa ransfer funcion Johnson were employed and analyzed by sofware Miniab 6 is locaed. The resuls of he K-S es afer he normal process daa as Figure 3. Tab.3. PD, dependen variable normaliy es resuls afer normalizaion process Significance level (Sig) 3 / Saisic (K-S) 3 The number (N) 6 Variable Flucuaions in he coss of research and developmen According o Figure 3, since he normalized daa significance level (Sig.) Kolmogorov-Smirnov es for he dependen variable is higher han 5/ (76/), so he hypohesis H and confirmed a 95% I is indicaive of he changing dynamics of he process of normalizaion of research and developmen expendiure, are normally disribued. CORRELATION BETWEEN VARIABLES In his secion, using Pearson's correlaion coefficien o assess he relaionship beween he variables and he correlaion beween hem will be discussed.marix of correlaions beween variables in Table 4 are presened. Based on he resuls of pearson, he level of insiuional ownership conrol and significan negaive correlaion wih he level of ownership and managemen conrol of he conrolling shareholder buys heir shows. Tab.4. PD marix Pearson correlaion coefficiens beween variables Flucuaions in he coss of research and developmen Financial consrains Conrol he level of insiuional ownership Conrol he level of managerial ownership Conrol of small shareholder s Corporae governance index Cash flow raio Flucuaions in he coss of research and developmen ( P Value) Financial consrains ( P Value) 3 /33 ) 3/77(. Conrol he level of insiuional ownership ( P Value) 3 /3 ) 3/( - 3/37 ) 3/(

5 Conrol he level of managerial ownership ( P Value) - 3/36 ) 3/( 3 /3 ) 3/( -3/ ) 3/333( Conrol of small shareholders ( P Value) - 3/36 ) 3/( 3 /3 ) 3/( -3/ ) 3/333( /333 ) 3/333( Corporae governance index ( P Value) - 3/3 ) 3/7( - 3/3 ) 3/6( -3/36 ) 3/67( - 3/36 ) 3/3( -3/36 ) 3/67( Cash flow raio ( P Value) - 3/337 ) 3/6( - 3/3 ) 3/7( - 3/3 ) 3/( 3 /333 ) 3/77( 3/333 ) 3/( - 3/3 ) 3/( Conrol he level of managerial ownership is posiively correlaed wih he level of small shareholders conrol. Sudy co-lineariy beween variables: Linear in he sense of a linear relaionship beween he explanaory variables or independen. One way o idenify he relaionship beween linear and non-linear ime o invesigae he correlaion beween independen variables. If here is no srong correlaion beween he independen variables, mulicollineariy problem will occur. In his sudy a linear relaionship beween he independen variables using Pearson's correlaion coefficien was used. As in Figure 4, is specified, he variables of financial consrains, he level of insiuional ownership conrol, level conrol, level conrol and managemen ownership of small shareholders does no show a direc correlaion. Therefore, due o his problem beween hese variables is no linear. No associaion wih oher variables can be difficul due o srong co-lineariy exiss beween hem and heir simulaneous enry model will cause mulicollineariy problem. The resuls of he firs hypohesis: The firs hypohesis es he relaionship beween financial consrains and he volailiy of he company's research and developmen expendiure and saisical hypohesis defined as follows: H: he financial consrains and he volailiy of he raio of R & D spending, here is no significan relaionship. H: beween financial consrains and flucuaions in he raio of R & D coss have a significan relaionship. This hypohesis using converers () for panel daa esimaion and if he coefficien is significan a 95% confidence level will be verified. Ln( CM 3 CF 6 H H 4 C( ε : : Cons 5 CG CIns In order o deermine wheher he use of panel daa in esimaing he model will be efficien or no, he Chow es in order o deermine which mehod of ying or F (fixed effecs or random effecs) is more appropriae o esimae (recogniion of he differences beween fixed or random cross-secional unis) used he Hausman es. The resuls of hese ess are presened in Table 5. Tab. 5. Picure of Chow and Hausman es resuls for he model () P- Value 3 /36 3 /37 Degrees of freedom ) 3 3( The saisics /376 /33 Saisics F Number 6 6 Tes Chow Hausman According o Chow es and P-Value of (84/), es H hypohesis was rejeced a 95%, indicaing ha he mehod can be used panel daa. Also according o he resuls of Hausman and P-Value of (394/), which is less han 5/, a 95% es H hypohesis is rejeced and he hypohesis H is acceped. Therefore, he model is esimaed using fixed effecs. To es he validiy of he classical regression model assumpions and analysis is required in addiion o he lack of co-lineariy beween he independen variables in he model, ess remained normal in connecion wih he consisency of variances, independence of residuals and he absence of clear error model (lineariy model) will also be performed. To es he normaliy of error erms can be used for various ess. One of hese ess is o es Jarek-bera his es has been used in his sudy. Jarek-bera es resuls o show ha residues of he model sudy, 95% of he normal disribuion, so he probabiliy of his es (.34) is larger han.5 One of he assumpions of he classical regression residuals variance is inconsisency. If he variances are non-linear esimaion is no unbiased and minimum variance here. The search for homogeneiy of variance es was used for pagan. Considering he imporance of his es, which is smaller han.5 (.3), he null hypohesis is rejeced and i can be said ha here is a similariy variance heerogeneiy of variance model is a problem. In his sudy, o fix he problem in esimaing esimaed using generalized leas squares (GLS) is used. Also in his sudy correlaed o es he residuals of a regression analysis and correlaion assumpions, analysis and called he Durbin Wason (D-W) is used. According o preliminary resuls of he Durbin-Wason saisic esimaion of beween.5 and.5 is.4, and since i can be concluded ha he residuals are independen. In addiion, o es wheher he relaionship is linear, and wheher he model of 3

6 he relaionship beween linear and non-linear explanaion is correc or no coded es was used. Given ha he level of symbolic es (.638) is larger han.5, so he null hypohesis of his es has been verified ha he linear model and he error is no specified. Summary resuls are presened in able above. Tab. 6. Picure of he resuls of he saisical assumpions of he model () According o he resuls of ess Chow and Hausman and also es classic assumpions of he regression model () research using panel daa and fixed effecs esimaed for. The resuls in Figure 7 is provided. The model is esimaed using he sofware will be Eviews 7 as follows: Ln( 87.38CIns. CG Cons 77.67CM.C F ε C( Tab. 7. Picure of he firs hypohesis es resuls using fixed effecs The dependen variable: volailiy of research and developmen expendiure Views: 6 firm - years Relaion Posiive Negaive Posiive Negaive meaningless meaningless Posiive 3 /636 3 /7 ) 3/337( P-Value 3 /337 3 /363 3 /337 3 /37 3 /6 3 /6 3 /373 T-saisics 6 /373 - /677 /3 - /33 - /3 /3 / Facor / - 3/336 /3-3/3 - / 3 /36 3 /36 Deermining facor model Saisics ( P Value) Variable Fixed componen Financial consrains Conrol he level of insiuional ownership Conrol he level of managerial ownership Conrol of small shareholders Corporae governance index Cash flow raio In considering he significance of he F-saisic model, given ha he probabiliy of smaller 5/ (98/) wih a significan 95% of he model is confirmed. Deermining model suggess ha 4/% of he volailiy of he raio of R & D expenses is explained by variables in he model. Reviews significan facors in he resuls presened in Table 7, since he probabiliy of he -saisic for variable rae financial consrains is smaller han 5/ (6/), he resul of a significan relaionship beween financial consrains and he volailiy of research spending and approved he developmen a 95 percen. The firs hypohesis is acceped and can say wih 95% confidence beween financial consrains and flucuaions in he raio of R & D spending, here is a significan relaionship. A negaive coefficien for his variable (4 / -) showed a negaive relaionship beween financial consrains and he volailiy of he company's research and developmen expendiure increased by uni so ha he financial consrains, flucuaions in he amoun of R & D expendiure 4/ uni decreases. Thus, according o he analysis made in connecion wih he confirmaion of he firs hypohesis can be concluded ha he financial consrains and he volailiy of he raio of R & D spending significan inverse relaionship exiss. The resuls of he second hypohesis: The aim of his sudy is o es he hypohesis wheher he level of insiuional ownership conrol and dynamics of R & D spending, here is a significan relaionship or no? And saisical hypohesis expressed as follows: H: he level of insiuional ownership and conrol of research and developmen expendiure flucuaions, here is no significan relaionship. H: he level of insiuional ownership and conrol of flucuaions in research and developmen coss have a significan relaionship This hypohesis using converers () for panel daa esimaion, and if he coefficien is significan a 95% confidence level will be verified. Ln( CM 3 H H 4 C( : : Cons 5 CG CIns 6 CF ε Reviews significan facors in he resuls presened in Table 7, since he probabiliy of he -saisic for variable rae conrol level of insiuional ownership is less han 5/ (94/), he resul of a significan relaionship beween he level of insiuional ownership and conrol Swing raio of R & D spending a 95 percen is approved. The second hypohesis is acceped and can say wih 95% confidence level of insiuional ownership and conrol of research and developmen expendiure flucuaions, here is a significan relaionship. 4

7 The posiive coefficien for his variable (38/87) showed a direc relaionship beween he level of insiuional ownership and conrol of research and developmen expendiure is volaile so as o conrol he level of insiuional ownership increased by un he volailiy of research and developmen expendiure o 38/87 rae of increase. Thus, according o he analysis made in connecion wih he second hypohesis can be concluded ha he flucuaions in he level of insiuional ownership and conrol of R & D spending, a significan relaionship exiss. Ln( 87.38CIns. CG Cons 77.67CM.C F ε CONCLUSION C( Research and developmen ( any consisen and creaive aciviies o increase knowledge of man, culure, sociey and use his knowledge for new applicaions (Beleck, ). In oher words, research and developmen, he process of urning ideas ino new producs and exising producs wih more qualiy (Driver e al., ). This is relaed o he profiabiliy of producion o he final consumer or echnology relaed o he producion process. Research and developmen play a major role in economic growh, o he exen ha i referred o as an imporan variable in he economy (Lvylry, ). The imporance of research and developmen so ha companies on he basis of research funds from GDP, divided ino developed or underdeveloped (Lisandro and Parker, ). In addiion o he mobiliy of R & D spending growh and economic developmen, enhancing he firm's profi is (Mankada- Paerno e al., ). The main subjec of innovaion, research and developmen aciviies and o coninuously provide he basis for new demands (Lazvnyk, ). This ype of demand which, in urn, simulaing invesmen, and ulimaely ensure economic growh and prosperiy are of grea imporance in he indusrial world are (Brunner, ). Developing companies should use heir scienific and echnical research and developmen capabiliies o develop o reduce he echnological gap wih esablished companies (Novin e al., ). Operaing cash flow of cash and cash equivalens on he Company can be accessed by facors such as invesmen in research and developmen of expenses have increased or decreased, as well as addiional cash invesmen in R & D spending can increase or reduce agency coss (he Barvyyng, ), so he quesions and poins ha are unclear in his relaionship need o examine his relaionship specifically in he Tehran Sock Exchange is srongly fel. Insiuional invesors due o he influence and power o conrol he companies are always looking for he insiuionalizaion of he inrinsic value of heir own asses (Aguilera and Jackson, ). Par of he cash flows from operaing aciviies in a new company dedicaed o he research and developmen expendiures, and his comes from hinking prospecive managers wih he ineress of shareholders or eniy associaed wih he conrol policies (Synkra and Rav, ). Lerner and Wolfe (6), believed ha companies wih growing cash flows wih a high percenage ownership of shares in he hands of persons confined o a fairly significan level of R & D expendiure in he financial saemens show. There is a direc relaionship beween cash flows and he growh rae of invesmen in R & D expendiure comes from hinking managers are under insiuional invesors (Chrynkv and Aschalr, 9). Companies wih differen incenives o keep heir cash. For example, he difference beween he cos of inernal and exernal financing makes he Company he borrowing, invesmen and conrol heir savings in he ime needed o cash ou heir own inernal cash flow (Lazvnyk, 8). If for some reason can no now he righ ime o cash requiremens, or have limied access o "financial consrains" deemed (Aghion e al., 9). Despie he financial consrains in he long erm be able o profiabiliy, growh and hus affec he company's financial saus and backgrounds may fall behind in he compeiion and even eliminaion of he marke provided for company (Paris e al., 9). Thus, access o resources (reserves) of cash in companies subjec o financial resricions deemed essenial (Aguilera and Jackson, ). So i is expeced ha in he even of flucuaions in operaing cash flow, cash reserves, he company is affeced by financial limiaions (Brown e al., 9). The division of he company in erms of financial consrains, financial consrains mus be defined (Lazvnyk, 8). The mos complee and mos explici definiion in his case is ha when companies are in he range of financing beween domesic coss and exernal coss allocaed funds are faced wih a gap (Driver e al., 8). Deermining he amoun of cash reserves for many companies is very imporan. I should be noed ha he liquidiy of an asse is higher power, is efficiency decreases (Kanpa and Asvnman, 8). On he oher hand, companies can finance heir invesmen projecs hrough capial marke operaions and conduc. Therefore, companies ha have favorable access o capial markes should ac o preserve cash (goosh e al., 7). The main purpose of his research sudy is o answer he main quesion is wheher he level of conrol, financial consrains and dynamics of research and developmen expendiure in companies lised in Tehran Sock Exchange here is a significan relaionship or no? Cash and financial consrains derived from i may be he beginning and end of cycle operaion imagined. Cash curren asses on he balance shee is he main elemen of he (Lazvnyk, 8). The decision on he amoun of cash available o fund cash managemen, which are expeced o be available in he fuure depends (Chrynkv and Aschalr, 9). In fac, due o he lack of liquidiy in a company can conain sysem-wide implicaions, he imporance of liquidiy for each insiuion is beyond any oher issue (Driver e al., 8). Knowledge managemen, knowledge managemen company's fuure cash flows should be eligible o ake par and according o he forecass predic he invesmen and 5

8 financing of he company wih a look forward o he company's growh guaranee (goosh e al., 7). As well as addiional cash invesmen in R & D expendiures can be helpful o increase he developmen of qualiaive and quaniaive companies (Rogers, 6). So pay aenion o how o handle cash managemen, along wih issues relaed o he ownership percenage of insiuional ownership and managemen srucure o increase he amoun of invesmen in research and developmen expendiure of he imporance and necessiy of his research. Liquidiy managemen or he abiliy o raise funds and he mauriy of heir commimens on ime comes, i is necessary for he survival of companies. Therefore, liquidiy managemen due o financial consrains of he corporae issues of he greaes imporance ha is being done by managers (aghione e al., 5). Liquidiy managemen and appropriae conrol levels can reduce he risk of serious problems. Wih regard o he issues raised by he research is conduced inside or ouside Iran, mosly on issues of financial consrains and is relaionship wih free cash flows. So as soon as he sudy examines he relaionship beween levels of conrol, financial consrains and he volailiy of research and developmen expenses have been paid here, and he necessiy of his sudy srongly fel in our counry. Arac invesors in he capial marke due o he new characer of our capial markes han in developed counries is of grea imporance in erms of managemen and in order o achieve hese o idenify he facors such as: Financial consrains, he level of insiuional ownership conrol, level conrol and managemen dominaed by small shareholders conrol he company and is impac on he volailiy of spending on research and developmen, basic can help achieve he ulimae goal of he company. Hypohesis es resuls: The resuls of he firs hypohesis: The check means ha he probabiliy of having he model according o he F saisic is he smaller 5/ (98/) wih a significan 95% of he model is confirmed. Deermining facor deskop model suggess ha 4/ percen of he flucuaions of R & D expenses is explained by variables in he model. Reviews significan facors in he resuls presened in Table 7, since he probabiliy of he -saisic for variable rae financial consrains is smaller han 5/ (6/), he resul of a significan relaionship beween financial consrains and he volailiy of research spending and approved he developmen a 95 percen. The firs hypohesis is acceped and can say wih 95% confidence beween financial consrains and flucuaions in he raio of R & D spending, here is a significan relaionship. A negaive coefficien for his variable (4 / -) showed a negaive relaionship beween financial consrains and he volailiy of he company's research and developmen expendiure increased by uni so ha he financial consrains, flucuaions in he amoun of R & D expendiure 4/ uni decreases. Thus, according o he analysis made in connecion wih he confirmaion of he firs hypohesis can be concluded ha he financial consrains and he volailiy of he raio of R & D spending significan inverse relaionship exiss. The resuls of he second hypohesis: Reviews significan facors in he resuls presened in Table 7, since he probabiliy of he -saisic for variable rae conrol level of insiuional ownership is less han 5/ (94/), he resul of a significan relaionship beween he level of insiuional ownership and conrol Swing raio of R & D spending a 95 percen is approved. The second hypohesis is acceped and can say wih 95% confidence level of insiuional ownership and conrol of research and developmen expendiure flucuaions, here is a significan relaionship. The posiive coefficien for his variable (38/87) showed a direc relaionship beween he level of insiuional ownership and conrol of volailiy is he raio of research and developmen expendiure increased by uni so as o conrol he level of insiuional ownership, changes in he raio of R & D spending as 38/87 of increases. Thus, according o he analysis made in connecion wih he second hypohesis can be concluded ha he flucuaions in he level of insiuional ownership and conrol of R & D spending, a significan relaionship exiss. REFERENCES [] Acharya, V.V., Almeida, H., Campello, M., (7). Is cash negaive deb? A hedging perspecive on corporae financial policies. J. Financ. Inermed. 6, [] Adhikar A. & A. Dura,. (6), "Volunary Disclosure of Free Cash Flow Informaion", Accouning Horizons, No. 4, PP [3] Almeida, H., Campello, M., Weisbach, M.S. (3). The cash flow sensiiviy of cash. J. Finance 59, [4] Baes, T.W., Kahle, K.M., Sulz, R.M.( 4). Why do U.S. firms hold so much more cash han hey used o? J. Finance 64, 985. [5] Beleck, J., Janahan, D. (4), "Do Accouning Earning or Free Cash Flow Provide Beer Esimae of Capial of Reurn on Sock", Securiy Analyss Journal, Vol. 39, No. 5, PP [6] Dichu Bao, Kam C. Chan b, Weining Zhang,(). Asymmeric cash flow ensiiviy of cash holdings, Journal of Corporae Finance [7] Drobez.W., Grüninger.M.C. (3). "Corporae cash holdings: Evidence from Swizerland". Swiss Sociey for Financial Marke Research. [8] Drobez.W., Grüninger.M.C. Grüninger, Simone Hirschvogl, (). "Informaion asymmery and he value of cash". Journal of Banking & Finance. [9] Edu.Ruback, J. D. (7), "Capial Cash Flow: A Simple Approach o Valuing Risky Cash Flow", Financial Managemen, No. 3, PP [] Erickson, T., Whied, T.M., (4). Measuremen error and he relaionship beween invesmen and Q. J. Poli. Econ. 8, [] Kohar S.P., Shu, S., Wysock P.D., (). Do managers wihhold bad news? J. Accoun. Res. 47, Riddick, L.A., Whied, T.M., 9. [] Kour, C., Saha, W.H., (4). Theory of he firm: managerial behavior, agency cos and ownership srucure. 6

9 J. Financ. Econ. 3, [3] Marshal, k.,gregory, A. & Y. H. Wang,. (4), "Cash Acquirers: Sources of Funding, Free Cash Flow and Shareholders Reurns", hp://cener.uv.nl/gs/chp/cash.pdf. 7