The valuation of abnormal accruals and corporate governance
| Autor: | Ray Donnelly, Godfrey Akileng |
|---|---|
| Rok vydání: | 2013 |
| Předmět: | |
| Zdroj: | International Journal of Managerial and Financial Accounting. 5:391 |
| ISSN: | 1753-6723 1753-6715 |
| DOI: | 10.1504/ijmfa.2013.058662 |
| Popis: | For the most part the extant literature considers abnormal accruals to be opportunistic and discounted by the market. However, an alternative view is that abnormal accruals signal manager’s private information of firm value and profitability so are valued positively by the market. In addition, there is evidence that effective corporate governance mitigates opportunistic earnings manipulation. While prior studies have tested for the impact of corporate governance on the value relevance of earnings this study is different in that it focuses on the impact of governance on the value relevance of that part of earnings that are likely to be manipulated: abnormal accruals. Using a sample that is comprised exclusively of accounting data reported under IFRS evidence is provided that the market views abnormal accruals as being on average opportunistic. However, it also perceives this opportunism to be mitigated by effective corporate governance. These findings are robust to alternative ways of measuring abnormal ac... |
| Databáze: | OpenAIRE |
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