Economic Consequences of Early Recognizing Assets Impairment

• Main Authors: Yu-Fang Ting, 丁毓芳
• Other Authors: Chia-Hui Chen
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/as7uw9

碩士 === 靜宜大學 === 會計學系研究所 === 97 === The major challenge of implementing Taiwanese Statements of Financial Accounting Standards No. 35 (TSFAS No.35), Accounting for Assets Impairment, lays in (1) lack of specified timing to recognize asset impairment and (2) lack of comparable and reliable measurement. Corporate managers are entitled to discretion under the TSFAS No.35. Following prior researches, this study examined (a) the extent of impact of early adopting TSFAS No. 35 on corporate profitability and (b) the market reaction to subsequent reversion of assets impairment recognized by the effective date of the TSFAS No. 35. The study found the corporate profitability has been significantly impacted by early adopting TSFAS No. 35, if managers have intention to conduct turnover of top management occurs. The study also found that investors give significantly positive response to the reversion of assets impairment in the third year after early recognizing assets impairment.