On the Relation between Conservatism in Accounting Standards and Incentives for Earnings Management
研究保守会计准则如何缓解理性的、但功能失调的不可观察盈余操纵，发现保守标准能改善风险分担和合同效率，对投资者和监管者理解会计准则设计有参考价值。
ABSTRACT This paper studies the role of conservative accounting standards in alleviating rational yet dysfunctional unobservable earnings manipulation. We show that when accounting numbers serve both the valuation role (in which potential investors use accounting reports to assess a firm's expected future payoff) and the stewardship role (in which current shareholders rely on the same reports to monitor their risk‐averse manager), current firm owners have incentives to engage in earnings management. Such manipulation reduces accounting numbers' stewardship value and leads to inferior risk sharing. We then show that risk sharing, and hence contract efficiency, can be improved under a conservative accounting standard where, absent earnings management, accounting earnings represent true economic earnings with a downward bias, compared with under an unbiased standard where, absent earnings management, accounting earnings represent true economic earnings without bias.