SUMMARY
Earnings quality of business unit is one of the most important information as the foundation of most of decisions and judgment of financial information users. The accuracy of financial forecast of a business unit is one of the interesting issues of financial information users. The present study aimed to evaluate the relationship and role of earnings quality in accuracy of prediction of cash flows from operations of companies listed on TSE. To achieve the study purpose, we selected 25 active industries during 5 years (2009-2013). A study sample of 50 companies is selected by Cochran’s formula. Based on the results of study, we can say by increase of earnings quality, accuracy of prediction of financial statement items namely cash flows from operations can be increased. Thus, earnings quality is a reliable criterion for accuracy of financial predictions as accuracy of annual financial performance of business units.