Details

Autor(en) / Beteiligte

• Keating, A.Scott
• L. Zimmerman, Jerold

Titel

Depreciation-policy changes: tax, earnings management, and investment opportunity incentives

Ist Teil von

• Journal of accounting & economics, 1999-12, Vol.28 (3), p.359-389

Ort / Verlag

Amsterdam: Elsevier B.V

Erscheinungsjahr

1999

Quelle

Elsevier Journal Backfiles on ScienceDirect (DFG Nationallizenzen)

Beschreibungen/Notizen

• Contrary to previous studies, we find managers change depreciation policies in predictable ways. We identify three dimensions of depreciation-policy changes: whether it is a method change or an estimate revision; whether it is income-increasing or decreasing; and whether it applies to new assets only or both new and existing assets. This disaggregation leads to three findings: First, a 1981 tax law altered the frequency of estimate revisions and method changes. Second, firms adopting income-increasing method changes for all assets experience worse performance than those adopting such changes only for new assets. Finally, non-income-increasing policy changes are associated with changes in investment opportunities.