Accounting conservatism and income smoothing practices in EU food and drink industry
نویسندگان
چکیده
Purpose The purpose of this paper is to identify the application fundamental principle accounting conservatism within EU food and drink industry. Furthermore, authors would also investigate in-depth above relationship in two different subsamples (income smoothers non-income smoothers). Design/methodology/approach All EU-listed companies industry were identified covering year 2019. Eckel's model was used classify listed as smoothing or non-smoothing, Basu's adopted test degree conditional conservatism. Findings results indicate that strongly present its subindustries. We showed non-smoothing firms had higher levels terms more opportunity recognize future economic losses because market could use stock return data anticipate contained information regarding profits. Research limitations/implications One limitation work small size investigated companies. demonstrate likely increased produces better credibility markets. Practical implications a monitoring practices by firms. Regulators have set policies enhance quality informational environment, investors shareholders might exercise control over executives' decisions, lenders impose contractual clauses requiring timely disclosure “bad news.” Originality/value This “belted” from any external speculations. research made it possible observe theoretical relationships between financial provided contributes distinction non-smoothers.
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ژورنال
عنوان ژورنال: British Food Journal
سال: 2021
ISSN: ['0007-070X', '1758-4108']
DOI: https://doi.org/10.1108/bfj-11-2020-1041