Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals

The subject concerning relationship between conservatism and information content of accruals relative to operating cash flows has been focused by many researchers. Felltham & Ohlson (1995) showed that the information content of accruals will increase conservatism, whereas the information content...

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Autores principales:	Golamreza Kordestani, Mehdi Khalili
Formato:	article
Lenguaje:	FA
Publicado:	Shahid Bahonar University of Kerman 2011
Materias:	differential information content accruals operating cash flows conservatism Accounting. Bookkeeping HF5601-5689
Acceso en línea:	https://doaj.org/article/22faa5274e4d498698fb858381d987e1
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spelling	oai:doaj.org-article:22faa5274e4d498698fb858381d987e12021-11-04T19:40:24ZImpact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals2008-89142476-292X10.22103/jak.2011.35https://doaj.org/article/22faa5274e4d498698fb858381d987e12011-03-01T00:00:00Zhttps://jak.uk.ac.ir/article_35_9961435e086d8a69c600e5a29701b88e.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XThe subject concerning relationship between conservatism and information content of accruals relative to operating cash flows has been focused by many researchers. Felltham & Ohlson (1995) showed that the information content of accruals will increase conservatism, whereas the information content of cash flows remains unaffected. We predict that the score of conservatism of the firm has effect on their information content of accruals and cash flows, and firms with a high degree of conservatism have greater information content of accruals. This study is trying to collect evidence on this issue. To test the hypotheses in this study, two statistics methods for cross-section and panel data analysis have been used with financial information of 92 firms in Tehran Stock Exchange during 1999-2007. The results show that accruals and differential information content of cash flows relative to accruals for the firms exhibiting a high degree of conservatism is greater than that of the firms showing a low degree of conservatism. Also, there is a positive correlation between the differential information content of cash flows relative to accruals and conservatism score of firms.Golamreza KordestaniMehdi KhaliliShahid Bahonar University of Kermanarticledifferential information contentaccrualsoperating cash flowsconservatismAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 2, Iss 4, Pp 53-104 (2011)
institution	DOAJ
collection	DOAJ
language	FA
topic	differential information content accruals operating cash flows conservatism Accounting. Bookkeeping HF5601-5689
spellingShingle	differential information content accruals operating cash flows conservatism Accounting. Bookkeeping HF5601-5689 Golamreza Kordestani Mehdi Khalili Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
description	The subject concerning relationship between conservatism and information content of accruals relative to operating cash flows has been focused by many researchers. Felltham & Ohlson (1995) showed that the information content of accruals will increase conservatism, whereas the information content of cash flows remains unaffected. We predict that the score of conservatism of the firm has effect on their information content of accruals and cash flows, and firms with a high degree of conservatism have greater information content of accruals. This study is trying to collect evidence on this issue. To test the hypotheses in this study, two statistics methods for cross-section and panel data analysis have been used with financial information of 92 firms in Tehran Stock Exchange during 1999-2007. The results show that accruals and differential information content of cash flows relative to accruals for the firms exhibiting a high degree of conservatism is greater than that of the firms showing a low degree of conservatism. Also, there is a positive correlation between the differential information content of cash flows relative to accruals and conservatism score of firms.
format	article
author	Golamreza Kordestani Mehdi Khalili
author_facet	Golamreza Kordestani Mehdi Khalili
author_sort	Golamreza Kordestani
title	Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
title_short	Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
title_full	Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
title_fullStr	Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
title_full_unstemmed	Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals
title_sort	impact of accounting conservatism on differential information content of cash flows and accruals
publisher	Shahid Bahonar University of Kerman
publishDate	2011
url	https://doaj.org/article/22faa5274e4d498698fb858381d987e1
work_keys_str_mv	AT golamrezakordestani impactofaccountingconservatismondifferentialinformationcontentofcashflowsandaccruals AT mehdikhalili impactofaccountingconservatismondifferentialinformationcontentofcashflowsandaccruals
_version_	1718444636252405760

Impact of Accounting Conservatism on Differential Information Content of Cash Flows and Accruals

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