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Abstract
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This study examines the moderating effect of auditor industry specialization
on the relationships of financial statement comparability and accounting policy
consistency with stock returns among companies listed on the Tehran Stock
Exchange. The study is applied in purpose and adopts an ex post facto causalcorrelational design based on archival financial data. The statistical population
consists of all companies listed on the Tehran Stock Exchange during the 2017–
2024 period. After applying the specified screening criteria, 85 firms were
selected, yielding 680 firm-year observations. Panel-data regression models with
firm fixed effects were used to test the hypotheses. The findings indicate that
financial statement comparability and accounting policy consistency are
positively and significantly associated with stock returns. The results also show
that auditor industry specialization strengthens both relationships by enhancing
the credibility and usefulness of comparable and consistent financial
information. These findings contribute to the accounting and auditing literature
by demonstrating that industry-specific audit expertise can reinforce the capitalmarket consequences of financial reporting quality. The results further suggest
that firms may benefit from engaging industry-specialist auditors because their
knowledge of industry-specific risks, transactions, and reporting practices can
improve audit quality, reduce information asymmetry, and increase investors
and creditors’ confidence in investment and lending decisions.
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