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Attribution Locus and the Timeliness of Long-lived Asset Write-downs

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  • Yao-Lin Chang
  • Chun-Yang Lin
  • Chi-Chun Liu
  • Stephen G. Ryan

Abstract

We examine the relative timeliness with which write-downs of long-lived assets incorporate adverse macroeconomic and industry outcomes versus adverse firm-specific outcomes. We posit that users of financial reports are more likely to attribute adverse firm-specific outcomes to suboptimal managerial actions, which provide managers with more incentive to delay write downs. We provide evidence that, controlling for other incentives to manage earnings, firms record write-downs in the current year that are driven by adverse macroeconomic and industry outcomes during both the current year and the next year, but they record write-downs driven by adverse firm-specific outcomes only in the current year.

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  • Yao-Lin Chang & Chun-Yang Lin & Chi-Chun Liu & Stephen G. Ryan, 2025. "Attribution Locus and the Timeliness of Long-lived Asset Write-downs," Papers 2509.10810, arXiv.org.
    • Handle: RePEc:arx:papers:2509.10810
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    File URL: http://arxiv.org/pdf/2509.10810
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