Confucian culture and accounting conservatism: evidence from China

China Journal of Accounting Research, Vol 2 Issue 2 Corporate Governance and Accounting Conservatism in China*

A principal-agent relationship exists among creditors, shareholders and management, and information asymmetry among them leads to asymmetric loss functions, which induces conservative accounting. This paper investigates the determinants of accounting conservatism using accrual-based measures and data from 2001 to 2006 in China. We find that a higher degree of leverage, lower level of control of...

Confucian Revival and School Culture

Accounting Conservatism and Real Options

I address the interaction between accounting conservatism and real options in both a staged investment and abandonment model. An accounting policy biased towards classifying a Good (Bad) project as Bad (Good) is conservative (aggressive). The accounting signal is optimally conservative when the ex ante unconditional expected terminal value is less than the second investment (staged investment) ...

Hedge Commitments and Agency Costs of Debt: Evidence from Interest Rate Protection Covenants and Accounting Conservatism

Manager Optimism Based on Environmental Uncertainty and Accounting Conservatism

It is expected that more accounting conservation (environmental uncertainty) reduces manager optimism. Prior research, however, has struggled to establish this relation empirically. Moreover, some evidence points to the possibility that the manager optimism is lower for firms with more accounting conservation. In this paper, the author examine the link between accounting conservation, environme...