Accounting conservatism: A life cycle perspective

Hansen, James C. and Hong b, Hong b and Park, Sang-Yun,(2018), Accounting conservatism: A life cycle perspective. , Advances in Accounting, Elsevier Ltd

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Abstract

This paper investigates whether a firm's life cycle stage affects its reporting conservatism in the cross-section. We Accounting conservatism Conditional conservatism Unconditional conservatism Firm life cycle JEL classification: M21 M41 use two measures of reporting conservatism used in Givoly and Hayn (2000): the level of non-operating accruals and the market-to-book ratio (unconditional conservatism); and the conservatism measure suggested by Basu (1997) (conditional conservatism). Firms are classified annually into life cycle stages using procedures proposed by Dickinson (2011). We find that unconditional reporting conservatism decreases over life cycle stages, but do not find evidence that conditional reporting conservatism is associated with life cycle stages. Our findings complement Givoly and Hayn (2000) and have implications for financial statement analysis and future research on accounting conservatism.
Keywords : Accounting conservatism Conditional conservatism Unconditional conservatism Firm life cycle, UNSPECIFIED
Journal or Publication Title: Advances in Accounting
Volume: 40
Number: UNSPECIFIED
Item Type: Article
Depositing User: Users 8 not found.
Date Deposited: 13 Dec 2019 07:45
Last Modified: 13 Dec 2019 09:11
URI: https://repofeb.undip.ac.id/id/eprint/81

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