José A. C. Moreira () (Faculdade de Economia da Universidade do Porto. CETE - Centro de Estudos de Economia Industrial, do Trabalho e da Empresa)
Abstract
This paper discusses the sign of the expected measurement error in discretionary accruals (DAC) estimates when accrual models do not control for the asymmetric treatment of gains and losses underlying conservatism. I show that DAC in firms with “bad news” are expected to be understated (positive measurement error), while those in “good news” firms will be overstated (negative measurement error). Based on this original result, and using graphical analysis, I discuss an empirical illustration, which corroborates the expectations.
Download Info
To our knowledge, this item is not available for
download. To find whether it is available, there are three
options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page
whether it is in fact available.
3. Perform a search for a similarly titled item that would be
available.
Find related papers by JEL classification: M41 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - Accounting C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
Did you know? You can include your works in the database easily by uploading them on the Munich Personal RePEc Archive (MPRA) if you do not have access to an institutional RePEc archive.