M.A. Thesis:

Regulatory mechanisms, Free cash flows and Investment performance

Investment in different fields by the companies have always been regarded as one of the most important ways of developing the companies and avoiding the stagnation. Among them, in addition to the development of the investment, limitations in resources puts the investment efficiency on the spotlight. The present study deals with the effect of supervision mechanisms and the free cash flows on the investment efficiency. The statistical population of this study includes 109 companies acknowledged by Tehran Stock Exchange during 2011 -2015. The variables employed in this study refer to the investment efficiency as the dependent variable and to the supervision mechanisms and free cash flows as the independent variables while the financial leverage and the size of the company are considered as the controlling variables. The supervision mechanisms studied in this research consist of the size of the auditing committees, the expertise of the auditing committee members and the size of the auditing institution. Primarily, the data were analyzed by SPSS20 descriptively. Then, using Eview 8 through a tailor-made statistical test and the regression analysis, the effect of supervision mechanisms as well as the impact of free cash flows on the investment efficiency was examined. The results obtained in this study indicate that the free cash flows and the expertise of the auditing committee members significantly and directly have an effect on the investment efficiency and the size of the auditing committee , but the size of the auditing institution does not positively and significantly affect the investment efficiency. In conclusion, the findings of the study demonstrated that the rise in free cash flow and the expertise of the auditing committee proved to improve the efficiency of the investment.

Keywords: Investment Efficiency, Supervision Mechanisms, Size of Auditing Institution, Size of Auditing Commit