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Accruals: Signalling or misleading?. Edition No. 1
VDM Publishing House, May 2009, Pages: 108
Studies on earnings management usually hypothesise
that managers manage accruals opportunistically. Few
studies however, argue that managers can also use
accruals to improve the value relevance of reported
earnings to help investors better assess the firm’s
operating performance. While substantial evidence on
managers’ opportunistic behaviour on accruals has
been documented in the literature, empirical
evidence on the informativeness of accruals is
scarce and inconclusive. This book examines this
issue using three corporate events as the research
settings. In addition, this book also examines the
persistence of the accrual anomaly, an anomaly
believed to be a manifestation of earnings
management. The results reported in this book should
yield some insights that could be useful to both
stock market investors and regulators in the Pacific-
Basin region whose stock market environments are
closer to that of New Zealand than to the United
States.
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