Value of Cash Holdings and Accounting Conservatisḿ

Contemporary Accounting Research

Volumn 29, Issue 4, 2012, Pages 1249-1271

  Louis, Henock ^a   Sun, Amy X ^a   Urcan, Oktay ^b  

^a PENNSYLVANIA STATE UNIVERSITY   (United States)

^b LONDON BUSINESS SCHOOL   (United Kingdom)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 84871446265     PISSN: 08239150     EISSN: 19113846     Source Type: Journal    
DOI: 10.1111/j.1911-3846.2011.01149.x     Document Type: Article

References (42)

1. Ahmed, A., and S. Duellman 2007. Accounting conservatism and board of director characteristics: An empirical analysis. Journal of Accounting and Economics43 (2-3): 411-37.
2. Arya, A., J. Glover, and S. Sunder 2003. Are unmanaged earnings always better for shareholders?Accounting Horizons17 (Supplement): 111-16.
3. Ball, R., A. Robin, and G. Sadka 2008. Is financial reporting shaped by equity markets or by debt markets? An international study of timeliness and conservatism. Review of Accounting Studies13 (2-3): 168-205.
4. Ball, R., and L. Shivakumar 2005. Earnings quality in UK private firms: Comparative loss recognition timeliness. Journal of Accounting and Economics39 (1): 83-128.
5. Basu, S. 1997. The conservatism principle and the asymmetric timeliness of earnings. Journal of Accounting and Economics24 (1): 3-37.
6. Bates, T., K. Kahle, and R. Stulz 2009. Why do U.S. firms hold so much more cash than they used to?The Journal of Finance64 (5): 1985-2021.
7. Bebchuk, L., A. Cohen, and A. Ferrell 2009. What matters in corporate governance?Review of Financial Studies22 (2): 783-827.
8. Biddle, G., and G. Hilary 2006. Accounting quality and firm-level capital investment. The Accounting Review81 (5): 963-82.
9. Biddle, G., G. Hilary, and R. Verdi 2009. How does financial reporting quality relate to investment efficiency?Journal of Accounting and Economics48 (2-3): 112-31.
10. Bushman, R., J. Piotroski, and A. Smith 2011. Capital allocation and timely accounting recognition of economic losses. Journal of Business Finance and Accounting38 (1-2): 1-33.
11. Callen, J., D. Segal, and O. Hope 2010. The pricing of conservative accounting and the measurement of conservatism at the firm-year level. Review of Accounting Studies15 (1): 145-78.
12. De Bondt, W., and R. Thaler 1985. Does the stock market overreact?The Journal of Finance40 (3): 793-805.
13. Dechow, P., and I. Dichev 2002. The quality of accruals and earnings: The role of accrual estimation errors. The Accounting Review77 (Supplement): 35-59.
14. Demski, J. 1998. Performance measure manipulation. Contemporary Accounting Research15 (3): 261-85.
15. Dittmar, A., and J. Mahrt-Smith 2007. Corporate governance and the value of cash holdings. Journal of Financial Economics83 (3): 599-634.
16. Easton, P., and T. Harris 1991. Earnings as an explanatory variable for returns. Journal of Accounting Research29 (1): 19-36.
17. Fama, E., and K. French 1993. Common risk factors in the returns on stocks and bonds. Journal of Financial Economics33 (1): 3-56.
18. Fama, E., and K. French 1997. Industry costs of equity. Journal of Financial Economics43 (2): 153-93.
19. Fama, E., and K. French 1998. Taxes, financing decisions, and firm value. The Journal of Finance53 (3): 819-43.
20. Faulkender, M., and R. Wang 2006. Corporate financial policy and the value of cash. The Journal of Finance61 (4): 1957-90.
21. García Lara, J. M., B. García Osma, and F. Penalva 2009. Accounting conservatism and corporate governance. Review of Accounting Studies14: 161-201.
22. García Lara, J. M., B. García Osma, and F. Penalva 2010. Conditional conservatism and firm investment efficiency. Available at SSRN: http://ssrn.com/abstract=1383642 or http://dx.doi.org/10.2139/ssrn.1383642.
23. Givoly, D., and C. Hayn 2000. The changing time-series properties of earnings, cash flows and accruals: Has financial reporting become more conservative?Journal of Accounting and Economics29 (3): 287-320.
24. Gompers, P., J. Ishii, and A. Metrick 2003. Corporate governance and equity prices. Quarterly Journal of Economics118 (1): 107-55.
25. Holthausen, R., and R. Watts 2001. The relevance of the value-relevance literature for financial accounting standard setting. Journal of Accounting and Economics31 (1-3): 3-75.
26. Jensen, M. 1986. Agency costs of free cash flow, corporate finance, and takeovers. American Economic Review76 (2): 323-29.
27. Jensen, M., and R. Walkling 2010. Pioneers in finance: An interview with Michael C. Jensen (October 29, 2010). Journal of Applied Finance No. 2: 7-14.
28. Khan, M., and R. Watts 2009. Estimation and empirical properties of a firm-year measure of conservatism Journal of Accounting and Economics48 (2-3): 132-50.
29. LaFond, R., and R. Watts 2008. The information role of conservatism. The Accounting Review83 (2): 447-78.
30. Louis, H., and D. Robinson 2005. Do managers credibly use accruals to signal private information? Evidence from the pricing of discretionary accruals around stock splits. Journal of Accounting and Economics39 (2): 361-80.
31. McNichols, M. 2002. Discussion of the quality of accruals and earnings: The role of accrual estimation errors. The Accounting Review77 (4): 61-69.
32. McNichols, M., and S. Stubben 2008. Does earnings management affect firms' investment decisions?The Accounting Review83 (6): 1571-603.
33. Myers, S., and N. Majluf 1984. Corporate financing and investment decisions when firms have information that investors do not have. Journal of Financial Economics13 (2): 187-221.
34. Opler, T., L. Pinkowitz, R. Stulz, and R. Williamson 1999. The determinants and implications of corporate cash holdings. Journal of Financial Economics52 (1): 3-46.
35. Pinkowitz, L., R. Stulz, and R. Williamson 2006. Does the contribution of corporate cash holdings and dividends to firm value depend on governance? A cross-country analysis. The Journal of Finance61 (6): 2725-51.
36. Rees, L., S. Gill, and R. Gore 1996. An investigation of asset write-downs and concurrent abnormal accruals. Journal of Accounting Research34 (Supplement): 157-69.
37. Skinner, D. 1993. The investment opportunity set and accounting procedure choice: Preliminary evidence. Journal of Accounting Economics16 (4): 407-45.
38. Subramanyam, K. 1996. The pricing of discretionary accruals. Journal of Accounting and Economics22 (1-3): 249-81.
39. Watts, R. 2003. Conservatism in accounting part I: Explanations and implications. Accounting Horizons17 (3): 207-21.
40. Wooldridge, J. 2002. Econometric analysis of cross-section and panel data. Cambridge, MA: MIT Press.
41. Wooldridge, J. 2008. Estimation of the average treatment effect in the correlated random coefficient model. In Advances in econometrics, Volume 21 (Modeling and evaluating treatment effects in econometrics), eds D. Millimet, J. Smith, and E. Vytlacil, 93-117. Amsterdam: Elsevier.
42. Zhang, J. 2008. The contracting benefits of accounting conservatism to lenders and borrowers. Journal of Accounting and Economics45 (1): 27-54.