Investigating the relationship between relocation Chief Executives and the accounting
performance of companies accepted in Tehran’s Stock Exchange
Bakhtiar Asgharzadeh*1
Saber Khorrami2
*
Masters of Accounting, Department of Accounting, Kermanshah Science and Research Branch,
Islamic Azad University, Kermanshah, Iran
Abstract:
The objectives of this study include: investigating the relationship between turnover ring the
chief executives and the accounting performance of the under- study companies, studying the role of
accounting performance of the under- study companies in turnover ring the chief executives and also
studying the factors affecting the turnover of the chief executives if the under- study companies.
Regarding the type of researches, the present research method is an applied research and regarding
deductive method it is a descriptive study. This study is also an ex post facto study regarding the design.
Regarding the contents, this research is a correlational one. The population of this study is comprised of
all companies which are active in Tehran’s Stock Exchange. The instruments through which the data
were gathered were check list, note- taking and summary profile. In order to collect data in the areas of
theoretical literature of the research and expressing its concepts within this research, library research
and articles, scientific web pages and books were used. Also the software for storing exchange
information such as Rahavard Novin 3 was used in order to extract the essential information from the
data. Also logistics regression is used in the this research in order to investigate the relationship
between independent variables and dependent variables taking into account the nature of the
dependent variable and in order to test the relationships Eviews3 analytical software was used.
The results show the relationship between changes in return on assets, return of investments
senior executives of earnings changes. In relation to changes in other variables affecting
executives were not observed.
Key words : Return On Asset, Return of investment, Executive management, Earning per share
1
. Bakhtiar.arshad63@yahoo.com
2
: Corresponding Author
. Accounting masters from Islamic Azad University‚ Kermanshah Science and Research Branch‚ Kermanshah,
Iran
3
. Eviews
1. Introduction
Nowadays it is probably a dream for any organization and in general for any system to have
flexible, professional and multi- talented managers and employees. The presence of one such
individuals can cause the affairs to become easier and faster to be resolved and could save time
and even recourses in the flow of the activities of any complex and can provide the opportunity
for developing skills and motivation. But how could we gain such forces in the organization,
there are different solutions one of which is job rotation. If we could rotate individuals in similar
and homogeneous jobs which they are familiar with, job rotation is created. Through this
method, the individual get familiar with more jobs and benefit from a variation in their job, they
turn into a suitable member of the organization and they become more motivated in their jobs.
One of the important and key positions in an organization is management which could affect all
activities of the organization.
2. Statement of the Problem:
Decisions made in the area of turnover ring managers are generally for the purpose of guiding an
organization towards an increase in growth and improvement in the performance of the company
(Lindrianasari, 2011). Macro managers come and go and along with these a flow of turnover s
and changes in mid managers and even some employees forms in the organizations. This event
has always been presented as an arguable and disputable issue for at least in the recent years in
our country and each group has looked at it from a different angle. Some regard it as necessary
and unavoidable and some pointed out its damaging aspects and inevitable damages. Studies
have also indicated that the average of management period is 2 years in our country. This
pressing government or short- lived managements will naturally be a threat to our facilities and
national recourses (Anvari, 1377). The new managers have entered the executional system with
new viewpoints and standpoint and designing new managerial systems have caused massive
changes in organizations’ levels. Financial performance has its special place especially in
companies active in exchange. In the middle of all this the question will be posed that what kind
of effect do accounting performances of companies have on the amount of the turnover of the
chief executives? We seek to find an answer to this question in the present research.
3. Research Background
- Rahnamaye Roodposhti and Khanmohammadi (1390) carried out a study titled investigating
and comparing the power of evaluation criteria of accounting performance and criteria which are
based on value in order to estimate the economic efficiency rate of the companies. The effect of
fluctuations of divided profit percentage on the efficiency of the shares of companies was
investigated in this research. In order to do this 86 companies which were accepted in Tehran’s
negotiable papers exchange were studied in an 8- year period (1387- 1380). Regression model
and spss software were used in order to analyze the data and test the hypotheses. The results of
the study indicate that there is a significant relationship between the fluctuation of divided profit
percentage and the shares’ efficiency of the companies.
- In a research titled investigating the relationship between the accounting criteria and
performance economy and the value of the companies in cement and petro chemistry exchange
of Tehran Pooyanfar and colleagues (1389) stated that the main criterion is to create value in
economic agencies from the viewpoint of size management and continuity of the remained profit
accounting which is measured in the framework of economic accumulated value. One of the
main obstacles in using the economic accumulated value criterion in Iran is the rareness of
observed cases. One of the common statistical methods which is used to overcome the abovementioned limitation is bootstrapping and in this article bootstrap regression was used to
compare and investigate the effect of economic and accounting criterion on evaluating the
performance of petro chemistry and cement industry companies which existing in Tehran’s
exchange during the years 1378- 1387. The results state the superiority of economic criterion in
comparison with accounting criterion and the insufficiency of accounting criterion in evaluating
the performances of the companies.
4. Foreign Researches:
-
-
-
-
-
Lindrianasari and Hartono (2011) conducted a research titled investigating the
relationship between accounting performance and turnover ring managers. This research
provides evidences with the aim to gain a better understanding accounting information in
turnover ring the managers. The past researches indicated unacceptable and incomplete
results in studying the relationship between accounting performance and turnover ring
managers. In order to measure the managers turnover variable in this research, all the
managers of Indonesia were considered during the years 1998- 2006. And it uses 140
companies. The results of the research indicated that there is a negative correlation
between the accounting performance and turnover ring the managers.
Bas ter Weel (2011) carried out a study carrying the title “Does turnover ring managers
improve the company’s performance?”. This research investigates the role of turnover
ring the managers in the performance of Netherland’s football league. The results of this
study did not indicate a positive correlation between turnover ring the managers and the
performance. A lot of specifications were presented for turnover ring the managers
variable in this research amongst which one is the quality of the manager’s decision and
the manager’s decision can have a significant effect on performance.
Postema and colleagues (1999) studied the relationship between the specifications of the
board of directors and the chief management team and the performance of the company.
One of the hypotheses they studied in their study was “the ratio of non- bound members
in the board of directors and the performance of the company have an inverse U form
relationship” the result of testing this hypothesis made it clear that the presence of nonbound members does not have a significant impact on the performance of the company.
Pang and colleagues (2003), studied the positive correlation the presence of non- bound
members in the board of directors and the performance of the Russian companies. The
findings of the research indicate that the mentioned correlation is not acceptable in the 5
percent level of significance.
Zahra and Pearce (1992) studied the relationship between the composition of the board of
directors, the past performance and the strategies of the company. They came to the
conclusion that there is a positive and significant correlation between the presence of
non- bound members as a criterion for the composition of the board of directors and the
rate of asset efficiency (ROA), the rate of efficiency of the rights of the shareholders
-
-
-
(ROA) and net earning per share (EPS) as criterion of financial performance of the
company.
Liang and Lee (1992) studied the relationship between the composition of the board of
directors and the performance of the company in Shanghai China. The results of this
estimation indicate that the presence of non- bound in the board of directors increases the
performance of the company.
Organ and colleagues (2005) attended to studying the role of non- bound members in the
decision making process and came to the conclusion that from the financial managers’
viewpoint that non- bound have an important role in good government.
George Farinha (2006) studied the relationship between the specifications if the board of
directors and the type of the reports of independent auditors of the companies accepted in
negotiable papers exchange in Portugal (except for investment companies and football
clubs) through using the information of 46 companies comparatively during the years
2002 to 2004. He showed that among various specifications of the board of directors
there is only a positive and significant correlation between the ratio of non- operational
members of the board of directors, the rate of assets proficiency, ownership ratio, the
natural logarithm of the assets at the end of the year and operational profit in the current
year and the opinion of the auditor. Also an increase in the ratio of market value to office
value of the shareholders’ rights and that the auditing of the company has been carried
out by 4 major international auditing institutes (rather than others) has a negative and
significant correlation with the type of the report accepted by independent auditors.
Welch and Ritter’s (2002) study, “a review of IPO (initial public offerings) activity,
pricing and allocations” in the test carried out by Welch and Ritter with regard to the
evaluation of stock and negotiable papers exchange of America between the years 1980
to 2001 they studied the performance of the market in accordance with the pricing of
shares of the newly arrived companies. the results of this study indicates that shares and
negotiable papers transactions of the newly arrived companies in the exchange at the end
of the first day was an average of 18.6 percent exchange prices more than the prices they
were sold at, at the beginning of the day of exchange of the company’s shares in the
market through the main company.
5. Theoretical principles of the research
Management is among important and strategic parts in all organizations. Nowadays no
organization can be hopeful about the continuation of their path without efficient and
effective management. While every manager can have a huge effect on the organizational
performance with his or her special viewpoint still the changes made by managers need
creating new structures and outlook of the organization and this affair can be of importance
taking into account its effectiveness on different areas of the organization (Saghafi &
Rezazadeh, 1382). Although this area is of importance no thorough research has been carried
out in the country which investigates managers’ rotation effect on the performance of the
company and this is while studying this issue within Iran where the issue of constant
changing of managers has always been considered and it becomes more important and
noticeable every day. On the other hand not attending to the effects of these changes can
affect the correct execution of organizational programs and maybe the performance of the
companies. This topic is one which the researcher discusses in this research meaning is there
a relationship between the accounting performance and changing the managers or not.
6. Research Hypotheses, Questions and Purposes
6.1. The purposes of this research include: 1. studying the relationship between turnover ring
the chief executives and the accounting performance of the under- study companies 2.
Studying the role of accounting performance of the under- study companies in turnover ring
chief executives 3. Studying the effective factors on turnover ring chief executives of the
under- study companies.
6.2. The research questions include: 1. which factors cause the chief executives to be
turnover red in the under- study companies? 2. Can we observe a significant relationship
between the accounting performance of the company and turnover ring the managers?
6.3. The hypotheses if the above research includes:
The main hypothesis: there is a significant and positive correlation between the accounting
performance and the chief executives’ turnover .
Secondary hypothesis 1: there is a significant and negative correlation between the sum total
of assets and turnover ring the chief executives.
Secondary hypothesis 2: there is a significant and negative correlation between the current
ratio and turnover ring the chief executives.
Secondary hypothesis 3: there is a negative and significant correlation between sales and
turnover ring the chief executives.
Secondary hypothesis 4: there is a negative and significant correlation between assets
efficiency and turnover ring the chief executives.
Secondary hypothesis 5: there is a negative and significant correlation between the
investment efficiency and turnover and executive managers.
Secondary hypothesis 6: there is a negative and significant correlation between profit and
turnover ring the chief executives
7. Research Population and Sample
The population of this study is comprised of all the productive companies which are active in
Tehran’s negotiable papers exchange from amongst the companies which have a negative
efficiency or have incomplete data are excluded from the present list and are not considered
as sample. Therefore this method if sampling is a systematic one.
The sample is selected on the basis of the following criterion and systematic elimination
method
1)
2)
3)
4)
5)
Were present in exchange from 1386 to 1390
Their fiscal year ends at the end of Esfand
The company has not changed fiscal year between the years 1386 to 1390
The companies did not have operational gaps between the years 1386 to 1390
The information of the company is relevant to the present variables
8. Instruments for collecting data include
Checklist: for the data and information which must be registered, it has a controlling function
Notes and summary profile: this instrument is used to sum up and control the information in the
present study
Since there were limitations which made the essential information related to dependent and
independent variables unavailable, the period related to the present research was select to be a 4year long period from 1386 to 1390.
The location of the domain of the present research also consists of all companies which were
accepted in Tehran’s exchange.
The subject domain of the research: the relationship between studying the relationship between
accounting performance and chief executives rotation (turnover ).
9. Research method
The present research is a descriptive one regarding the method type. Amongst all descriptive
researches this is a correlational research because the relationship between the dependent and
independent variables is what is studied in it. A descriptive study describes and explains what is
without interfering and altering. In correlational research the main objective is to determine
whether there is a relationship between or among two or more quantitative variables and if one
such relationship exists how big or strong it is. The method used to collect the used data was a
field one and the instrument for collecting the data is the financial data which is in Tehran’s
negotiable papers exchange.
10. Analyzing the Data
In order to collect data in the area of theoretical literature of the research and expressing the
concepts in this research, library studies were carried out in the form of articles, scientific web
pages and books. Also in order to collect data we use the existing data in exchange- data- storing
software such as Rahavard Novin 3. In order to investigate the relationship between dependent
and independent variables regarding the nature of the dependent variable we use logistic
regression in this research. In order to test the relationships we use Eviews which is a software
that analyzes data.
11. Research Design and its Variables:
TURNOVER
TASSETS
CURRATT
TSALES
ROA
ROI
EARNINGS
Rotating the managers in this manner: in each fiscal year we refer to the balance sheets of
the companies and study the name of their managements. In case the manager has not
changed since the year before we use 0 and in case the manager changes we use 1
The entire assets of the company which represents the size of the company
The current ratio equal to the ratio of the current assets to the current debts
The amount of the sales of the company which represents the real performance of the
management
Return On Asset
Return of investment
Profit
The conceptual model of this research was obtained as shown below in the framework of
regression equation. In this model the chief executives turnover is actually presented as the
dependent variable and other variables of accounting performance are presented in the form of
independent variables.
Equation 1:
In order to test the hypotheses we studied their normality was tested and regarding their
normality or not being normal, the type of test was determined.
The normality of the data:
Table number 1: data normality table
Inferential method
Variable
Executive managers
turnover
Accounting
performance
Sum of assets
Current ratio
Profit
Sales amount
Investment efficiency
rate
Asset efficiency rate
Number
470
Jarque- Bera Statistic
0.352
Level of significance
0.832
470
0.586
0.547
470
470
470
470
470
1.523
0.785
0.348
0.429
0.491
0.084
0.794
0.651
0.537
0.674
470
0.652
0.983
The hypotheses to be studied are defined as follows:
𝐻 ∶ the observations follow normal distribution
{ 0
𝐻1 ∶ the observations do not follow normal distribution
Therefore taking into account the fact that the level of significance related to all variables is
bigger than 0.05, the normality of observations hypothesis (hypothesis 0) will not be rejected.
Following this, taking into consideration that the observations follow the normal distribution,
parametric methods are used in order to analyze and study the observations.
12. Testing the hypothesis of the research
12.1. Main Hypothesis
H0 hypothesis (null hypothesis): main hypothesis: there is no positive and significant correlation
between accounting performance and chief executives turnover.
H1 hypothesis: main hypothesis: there is a positive and significant correlation between
accounting performance and chief executives turnover
The regression fit for the above- mentioned hypothesis is as follows:
Equation 2:
Considering the above regression model, the statistical hypotheses are stated as follows:
H0 : βi = 0
H1 : βi = 0
In order to study the relationship between accounting performance and chief executives turnover
the Logit Model (1) is used.
Table number (2): the estimate of the model on the basis of data- Variable Relocation
senior managers = Y
Descriptive
variables
Parameter
Standardized
coefficient
t statistic
Prob.
LNTASS
LNTSALE
ROA
ROI
CUR
EARN
0.050
-0.063
0.0046
0.00019
0.00034
-0.000000037
0.184
0.193
0.006
0.001
0.002
0.000000048
0.274
-0.328
1.813
-1.204
0.174
-0.777
0.784
0.743
0.041
0.028
0.862
0.044
Level of
significance
model
0.034
Through comparing the level of significance with 0.05 the H0 hypothesis on the basis of the
coefficients being zero will be rejected (P-value>0.05) and the significance of the entire
regression model will be proved. As it is shown in the table the level of significance of the model
for ROA, ROI and EARN variables was less than 0.05 which regarding statistics it is significant
in 5 percent error level. Therefore we can conclude that one there is a significant relationship
between the indexes of accounting meaning ROA, ROI, EARN and chief executive turnover.
12.2. Testing the first secondary hypothesis:
Secondary hypothesis 1: there is a negative and significant relationship between the sum total of
assets and chief executives turnover.
The statistical hypothesis will be stated as follows:
H0 : β1 = 0
H1 : β1 = 0
Table number 3: the estimate of the model on the basis of the data- chief executives turnover
variable= Y1
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
LNTASS
0.3788
-0.0694
0.7674
0.1269
0.4936
-0.5479
0.6216
0.5840
0.048
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for LNTASS variable is more than 0.05 which is not significant in the error
level of 5 percent statistically speaking. Therefore it could be concluded that one there is no
significant relationship between LNTASS and chief executives turnover.
12.3 testing the second secondary hypothesis:
Secondary hypothesis 2: there is a negative and significant relationship between sale and
chief executive turnover.
In order to study the equation we will use Logit model.
The statistical hypotheses will be stated as follows:
H0 : β1 = 0
H1 : β1 = 0
Table number 4: the estimate of the model on the basis of the data- chief executives turnover
variable= Y
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
LNTASS
0.396498
-0.075318
0.711072
0.122123
0.557606
0.616737
0.5771
0.5374
0.55
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will not be rejected (P-value<0.05) and it will be rejected
that the whole regression model is significant. As it is shown in the table, the level of
significance for the model for LNTSALE variable is more than 0.05 which is not significant
in the error level of 5 percent statistically speaking. Therefore it could be concluded that one
there is no significant relationship between LNTSALE and chief executives turnover.
12.4 testing the third secondary hypothesis
Secondary hypothesis 3: there is a negative and significant correlation between current ratio and
chief executives turnover.
In order to study the equation, Logit model will be used.
The statistical hypothesis will be stated as follows:
H0 : β1 = 0
H1 : β1 = 0
Table number 5: the estimate of the model on the basis of the data- chief executives turnover
variable= Y
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
CUR
-0.042206
0.000874
0.099638
0.001870
0.423590
0.467531
0.6719
0.6401
0.63
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will not be rejected (P-value<0.05) and it will be rejected
that the whole regression model is significant. As it is shown in the table, the level of
significance for the model for CUR variable is more than 0.05 which is not significant in the
error level of 5 percent statistically speaking. Therefore it could be concluded that one there
is no significant relationship between CUR and chief executives turnover.
12.5 testing the fourth secondary hypothesis
Secondary hypothesis 4: there is a negative and significant correlation between assets efficiency
and chief executives turnover.
In order to study the equation, Logit model will be used.
The statistical hypotheses will be stated as follows:
H0 : β1 = 0
H1 : β1 = 0
Table number 6: the estimate of the model on the basis of the data- chief executives turnover
variable= Y
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
ROA
-0.088066
0.004099
0.103814
0.004510
-0.8483
0.9089
0.3963
0.0363
0.048
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for ROA variable is less than 0.05 which is significant in the error level of 5
percent statistically speaking. Therefore it could be concluded that one there is a significant
relationship between ROA and chief executives turnover.
12.6 testing the fifth secondary hypothesis
Secondary hypothesis 5: there is a negative and significant correlation between investment
efficiency and chief executives turnover.
In order to study the equation, Logit model will be used.
H0 : β1 = 0
H1 : β1 = 0
Table number 7: the estimate of the model on the basis of the data- chief executives turnover
variable= Y
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
ROI
-0.035124
-0.000179
0.0942289
0.000942
0.372519
0.190076
0.7095
0.02492
0.037
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proveded
that the whole regression model is significant. As it is shown in the table, the level of
significance for the model for ROI variable is less than 0.05 which is significant in the error
level of 5 percent statistically speaking. Therefore it could be concluded that one there is a
significant relationship between ROI and chief executives turnover.
12.7 testing the sixth secondary hypothesis
Secondary hypothesis 6: there is a negative and significant correlation between profit and chief
executives turnover.
In order to study the equation, Logit model will be used.
H0 : β1 = 0
H1 : β1 = 0
Table number 8: the estimate of the model on the basis of the data- chief executives turnover
variable= Y
Descriptive
variables
parameter
Standardized
coefficients
t statistic
Prob.
Level of
significance
model
C
EARN
0.3788
-0.0694
0.7674
0.1269
0.4936
-0.5479
0.6216
0.0458
0.026
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for EARN variable is less than 0.05 which is significant in the error level of 5
percent statistically speaking. Therefore it could be concluded that one there is significant
and negative relationship between EARN and chief executives turnover.
Table number 9: the summary of the results of the hypothesis
Number
1
2
3
4
5
6
Hypothesis
There is a negative and significant correlation between the sum total of
assets and chief executives turnover
There is a negative and significant correlation between sales and chief
executives turnover
There is a negative and significant correlation between current ratio
and chief executives turnover
There is a negative and significant correlation between assets
efficiency and chief executives turnover
There is a negative and significant correlation between investment
efficiency and chief executives turnover
There is a negative and significant correlation between profit assets
and chief executives turnover
Accepted/ rejected
Rejected
Rejected
Rejected
Accepted
Accepted
Accepted with an
inverse relationship
13. Conclusion
Conclusion for the main hypothesis:
H0 hypothesis (null hypothesis): main hypothesis: there is no positive and significant correlation
between accounting performance and chief executives turnover.
H1 hypothesis: main hypothesis: there is a positive and significant correlation between
accounting performance and chief executives turnover
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for ROA, ROI, EARN variables is less than 0.05 which is significant in the
error level of 5 percent statistically speaking. Therefore it could be concluded that one there
is significant relationship between ROA and ROI and EARN indexes of accounting
performance and chief executives turnover. Therefore it could be stated that these factors
could be used in order to evaluate the performance of the executives of the companies and
could be called applied factors which are beneficial in evaluating managers and have a direct
relationship with operational activities of the managers.
First secondary hypothesis: there is a negative and significant correlation between the sum
total of assets and chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for LNTASS variable is more than 0.05 which is not significant in the error
level of 5 percent statistically speaking. Therefore it could be concluded that one there is no
significant relationship between LNTASS and chief executives turnover. Therefore it could
be stated that the sum of assets is not considered as a determining factor for evaluating
managers.
Second secondary hypothesis: there is a negative and significant correlation between sales
and chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will not be rejected (P-value<0.05) and it will be rejected
that the whole regression model is significant. As it is shown in the table, the level of
significance for the model for LNTSALE variable is more than 0.05 which is not significant
in the error level of 5 percent statistically speaking. Therefore it could be concluded that one
there is no significant relationship between LNTSALE and chief executives turnover.
Therefore it could be stated that changes in the level of sales do not cause changes in the
levels of executives in other words changes in sales area is not related to changes in
executives.
Secondary hypothesis 3: there is a negative and significant correlation between current ratio
and chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will not be rejected (P-value<0.05) and it will be rejected
that the whole regression model is significant. As it is shown in the table, the level of
significance for the model for CUR variable is more than 0.05 which is not significant in the
error level of 5 percent statistically speaking. Therefore it could be concluded that one there
is no significant relationship between CUR and chief executives turnover. Therefore it could
be stated that the current ratio could not be named as a factor which can change management
in other words changing the executives is not carried out through considering currant ration
changes.
Secondary hypothesis 4: there is a negative and significant correlation between the efficiency
of assets and chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for ROA variable is less than 0.05 which is significant in the error level of 5
percent statistically speaking. Therefore it could be concluded that one there is a significant
relationship between ROA and chief executives turnover. Therefore it could be stated that
there is a relationship between assets efficiency rate and management turnover in other words
assets efficiency ratio is considered one of the factors which affects changes in executives.
Secondary hypothesis 5: there is a negative and significant correlation between the
investment efficiency and chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for ROI variable is less than 0.05 which is significant in the error level of 5
percent statistically speaking. Therefore it could be concluded that one there is a significant
and negative relationship between ROI and chief executives turnover. Therefore it could be
stated that there is an inverse relationship between changes taken place in the investment
efficiency rate and executives turnover in other words when investment efficiency increases
there will be changes made in the level of executives and along with the decrease of
investment efficiency rate no changes will be made in the level of executives.
Secondary hypothesis 6: there is a negative and significant correlation between profit and
chief executives turnover.
Logit model is used in order to study the relationship.
Through comparing the level of significance of the model with 0.05 H0 hypothesis based on
the coefficients being equal to zero will be rejected (P-value>0.05) and it will be proved that
the whole regression model is significant. As it is shown in the table, the level of significance
for the model for EARN variable is less than 0.05 which is significant in the error level of 5
percent statistically speaking. Therefore it could be concluded that one there is a significant
and negative relationship between EARN and chief executives turnover. Therefore it could
be stated that an increase in the profit level changes take place in management level and
when profit decreases no changes will take place.
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