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Research Details
Causes and Effects of Discretionary Asset Write-offs, Journal of Accounting Research
Abstract
This paper provides evidence on the causes and shareholder wealth effects of discretionary asset write-offs. We find that both managers' incentives to manipulate earnings and economic impairment explain write-off decisions in general, however, incentives play a stronger role in the decision to write-off discretionary items such as intangibles. Investors' reactions to the write-off announcements depend on the nature of the asset being written-off because of the underlying motivation for the wirte-off.
Type
Article
Author(s)
Jennifer Francis, J.Douglas Hanna, Linda Vincent
Date Published
1996
Citations
Francis, Jennifer, J.Douglas Hanna, and Linda Vincent. 1996. Causes and Effects of Discretionary Asset Write-offs. Journal of Accounting Research.(Supplement): 117-134.