SFAS No.34 and Income Smoothing

• Main Authors: Pao-Hsien Wu, 吳柏賢
• Other Authors: 紀志毅
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/91136764736125084685

碩士 === 國立中興大學 === 財務金融系所 === 97 === Taiwan’s SFAS No. 34 published in 2006/1/1 and the content is about the recognition and measurement of financial instruments. After it published, most financial assets and financial liabilities should be measured at fair value. And it will affect the volatility of earnings. Besides, it will also affect the decision of firms using income smoothing tools. The sample was choose from Top 200 Taiwan listed company ranked by market value and the period was from 2003 to 2008. This study uses the probit model and simultaneous equation to estimate the relationship between discretionary accrual and derivatives and considers the factor of SFAS No.34 publishing. The empirical study indicated that the degree of firms using derivatives decreases after SFAS NO. 34 published. In addition, I find the phenomenon when the liability ratio of firms is higher , the firms will use more two kinds of income smoothing tools. Finally, the scale or the export ration of the firm is larger, the inclination to using derivatives for hedging is higher.