摘要：The purpose of this study is to investigate the effect of earnings quality and audit quality on capital costs during the sanctions in Tehran Stock Exchange companies. In order to achieve the research objectives, the information of the companies accepted in the Tehran Stock Exchange was used during a 7-year period (2009-2015). In this research, the audit quality was assessed using two criteria of the size of the audit firm and the continuity of the audit firm's cooperation with the owner. In order to calculate the cost of capital from the ratio of earning to the adjusted price of the industry and for the earning quality, the equation introduced by Freeman et al. 1982 has been used. The research hypotheses have been tested using the combined regression analysis. The results showed that the size of the audit firm and the continuity of cooperation between the audit firm have a reverse and significant relationship with the cost of capital. So, it can be concluded that the audit quality will reduce the cost of capital. Also, with the increase in the earning quality, the cost of capital decreases. This result suggests that the earning quality is an effective and meaningful factor in reducing or increasing the cost of capital companies. On the other hand, the sanctions imposed in 2010 did not affect the variable of capital cost.
