University of Isfahan Financial Accounting Research 2322-3405 9 2 2017 08 23 The Impact of Mental Accounting on the Investor’s Behavior: Financial Reporting Perspective The Impact of Mental Accounting on the Investor’s Behavior: Financial Reporting Perspective 1 22 22244 10.22108/far.2017.103495.1062 FA Alireza Kian Instructor in Accounting, Department of Accounting, Payame Noor University,Tehran , Iran &Ph.D. Student, University of Mazandaran, Baboolsar, Iran Omid Pourheydari Professor in Accounting, Faculty of Manegment and Economics, Shahid Bahonar University of Kerman, Kerman, Iran. Yahya Kamyabi Assistant Prof. in Accounting, Faculty of Economics and Administrative Sciences, University of Mazandaran, Babolsar, Iran Journal Article 2017 04 17 Although mental accounting theory was developed to explain consumer and household decision-making, we believe that its ideas are applicable to preparers and external users of financial reports and voluntary disclosures. The three central features of mental accounting theory (namely, coding, categorization, and evaluation) match up with important features in financial reporting and voluntary disclosure. Investors are sensitive to how financial reporting and voluntary disclosure in order to decide financial decision and economic analysis of the events. But in recent decades, some anomalies behavior in financial markets has been happen that the classical financial theory has not been able to explain them. Therefore, some concepts such as mental accounting in behavioral finance has been raised that researches have paid attention to them. As a result, this research attempts to explain the role of mental accounting in financial reporting from investors' perspective. Required data were collected from a sample of 120 of companies listed in Tehran Stock Exchange during 2006-2015. Results show that losses have moderating effect on the relationship between net profit and stock price. Therefore, it is expected to confirm the mental accounting theory in the income statement. <br />Therefore, the samples of 120 companies listed in the Tehran Stock Exchange during the years 2006- 2015 were analyzed. Although mental accounting theory was developed to explain consumer and household decision-making, we believe that its ideas are applicable to preparers and external users of financial reports and voluntary disclosures. The three central features of mental accounting theory (namely, coding, categorization, and evaluation) match up with important features in financial reporting and voluntary disclosure. Investors are sensitive to how financial reporting and voluntary disclosure in order to decide financial decision and economic analysis of the events. But in recent decades, some anomalies behavior in financial markets has been happen that the classical financial theory has not been able to explain them. Therefore, some concepts such as mental accounting in behavioral finance has been raised that researches have paid attention to them. As a result, this research attempts to explain the role of mental accounting in financial reporting from investors' perspective. Required data were collected from a sample of 120 of companies listed in Tehran Stock Exchange during 2006-2015. Results show that losses have moderating effect on the relationship between net profit and stock price. Therefore, it is expected to confirm the mental accounting theory in the income statement. <br />Therefore, the samples of 120 companies listed in the Tehran Stock Exchange during the years 2006- 2015 were analyzed. https://far.ui.ac.ir/article_22244_a4f29f4bfb7d1102b9adc051355896ca.pdf