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Departmental Research : Accounting: Alastair Lawrence (UC Berkeley)
1:30 PM to 3:30 PM
Winkler-Lund Conference Room
Alastair Lawrence of UC Berkeley will present his research on "Mandatorily Conservative Accounting: Evidence and implications."
ABSTRACT: A large body of accounting research hypothesizes that various economic incentives induce cross-sectional variation in managers? application of conservative accounting. We hypothesize that mandatory accounting rules are the primary determinant of conservative accounting. For example, assets are required to be impaired when their fair value drops sufficiently below their carrying value. We provide strong evidence of the resulting mandatorily conservative accounting. Moreover, we show that its omission leads to serious correlated omitted variables problems in previous research.
Accounting (Academic Dept),Business School Dean's Office
Yongtae KimTel 408-554-4578