Samenvatting
Financial Accounting Theory Summary
- Instelling
- Rijksuniversiteit Groningen (RuG)
In this summary the chapters 1-8, 10 & 11 are covered.
[Meer zien]Voorbeeld 3 van de 29 pagina's
Voorbeeld 3 van de 29 pagina's
In winkelwagengesponsord bericht van onze partner
Gekoppeld boek
Titel boek:
Auteur(s):
- Uitgave:
- ISBN:
- Druk:
Voorbeeld van de inhoud
FAT samenvattingFinancial Accounting Theory
Inhoudsopgave
Chapter 1 Introduction................................................................................................................................... 4
1.1 THE OBJECTIVE OF THIS BOOK.......................................................................................................................4
1.2 SOME HISTORICAL PERSPECTIVE....................................................................................................................4
1.3 THE 2007 – 2008 MARKET MELTDOWNS.......................................................................................................4
1.4 EFFICIENT CONTRACTING...............................................................................................................................4
1.5 A NOTE ON ETHICAL BEHAVIOUR..................................................................................................................5
1.6 RULE-BASED VERSUS PRINCIPLE-BASED ACCOUNTING STANDARDS.............................................................5
1.7 THE COMPLEXITY OF INFORMATION IN FINANCIAL ACCOUNTING AND REPORTING...................................5
1.8 THE ROLE OF ACCOUNTING RESEARCH..........................................................................................................5
1.9 THE IMPORTANCE OF INFORMATION ASYMMETRY......................................................................................5
1.10 THE FUNDAMENTAL PROBLEM OF FINANCIAL ACCOUNTING THEORY.......................................................6
1.11 REGULATION AS A REACTION TO THE FUNDAMENTAL PROBLEM..............................................................6
Chapter 2 Accounting Under Ideal Conditions................................................................................................. 7
2.1 OVERVIEW......................................................................................................................................................7
2.2 THE PRESENT VALUE MODEL UNDER CERTAINTY..........................................................................................7
2.3 THE PRESENT VALUE MODEL UNDER UNCERTAINTY.....................................................................................7
2.4 EXAMPLES OF PRESENT VALUE ACCOUNTING...............................................................................................8
2.4.1 Embedded Value.....................................................................................................................................8
2.4.2 Reserve Recognition Accounting............................................................................................................8
2.5 HISTORICAL COST ACCOUNTING REVISITED...................................................................................................8
2.6 THE NON-EXISTENCE OF TRUE NET INCOME.................................................................................................8
Opdrachten hoofdstuk 2................................................................................................................................ 9
Chapter 3 The Decision-usefulness Approach to Financial Reporting.............................................................10
3.1 OVERVIEW....................................................................................................................................................10
3.2 THE DECISION-USEFULNESS APPROACH......................................................................................................10
3.3 SINGLE-PERSON DECISION THEORY.............................................................................................................10
3.3.1 Decision Theory Applied.......................................................................................................................10
3.3.2 The Information System.......................................................................................................................11
3.3.3 Information Defined.............................................................................................................................11
3.4 THE RATIONAL, RISK AVERSE INVESTOR......................................................................................................11
3.5 THE PRINCIPLE OF PORTFOLIO DIVERSIFICATION........................................................................................12
3.6 INCREASING THE DECISION-USEFULNESS OF FINANCIAL REPORTING.........................................................12
Chapter 4 Efficient Securities Markets.......................................................................................................... 13
4.1 OVERVIEW....................................................................................................................................................13
, 4.2 EFFICIENT SECURITIES MARKETS..................................................................................................................13
4.3 IMPLICATIONS OF EFFICIENT SECURITIES MARKETS FOR FINANCIAL REPORTING......................................14
4.4 THE INFORMATIVENESS OF PRICE................................................................................................................14
4.5 A MODEL OF COST OF CAPITAL....................................................................................................................14
4.6 INFORMATION ASYMMETRY........................................................................................................................15
Chapter 5 The Value Relevance of Accounting Information...........................................................................16
5.1 OVERVIEW....................................................................................................................................................16
5.2 OUTLINE OF THE RESEARCH PROBLEM........................................................................................................16
5.2.1 Reasons for Market Response..............................................................................................................16
5.2.2 Finding the Market Response...............................................................................................................16
5.2.3 Separating Market-wide and Firm-specific Factors..............................................................................17
5.3 THE BALL AND BROWN STUDY.....................................................................................................................17
5.3.1 Methodology and Findings...................................................................................................................17
5.3.2 Causation Versus Association...............................................................................................................17
5.4 EARNINGS RESPONSE COEFFICIENTS...........................................................................................................18
Chapter 6 The Valuation Approach to Decision Usefulness...........................................................................19
6.1 OVERVIEW....................................................................................................................................................19
6.2 BEHAVIOURAL FINANCE V. MARKET EFFICIENCY AND INVESTOR RATIONALITY.........................................19
6.2.1 Introduction to Behavioural Finance....................................................................................................19
6.2.2 Prospect Theory....................................................................................................................................19
6.2.3 Validity of Beta as the Sole Risk Measure............................................................................................19
6.2.4 Excess Stock Market Volatility..............................................................................................................19
6.3 EFFICIENT SECURITIES MARKET ANOMALIES...............................................................................................20
6.4 LIMITS TO ARBITRAGE..................................................................................................................................20
6.5 A DEFENCE OF AVERAGE INVESTOR RATIONALITY......................................................................................20
6.5.1 Dropping Rational Expectations...........................................................................................................20
6.5.2 Dropping Common Knowledge.............................................................................................................20
6.9 OHLSON’S CLEAN SURPLUS THEORY............................................................................................................20
6.9.1 Three Formulae for Firm Value.............................................................................................................20
Chapter 7 Valuation Applications................................................................................................................. 22
7.1 OVERVIEW....................................................................................................................................................22
7.2 CURRENT VALUE ACCOUNTING...................................................................................................................22
7.4 FINANCIAL INSTRUMENTS DEFINED............................................................................................................22
7.5 PRIMARY FINANCIAL INSTRUMENTS............................................................................................................22
7.6 FAIR VALUE VERSUS HISTORICAL COST........................................................................................................22
7.10 CONCLUSIONS ON ACCOUNTING FOR FINANCIAL INSTRUMENTS............................................................22
7.11 ACCOUNTING FOR INTANGIBLES...............................................................................................................22
7.12 REPORTING ON RISK...................................................................................................................................23
7.12.1 Beta Risk.............................................................................................................................................23
7.12.2 Why Do Investors Care about Firm-specific Risk?..............................................................................23
7.12.3 Stock Market reaction to Other Risks.................................................................................................23
Chapter 8 Efficient Contracting Theory and Accounting.................................................................................24
, 8.1 OVERVIEW....................................................................................................................................................24
8.2 EFFICIENT CONTRACTING THEORY AND ACCOUNTING...............................................................................24
8.3 SOURCES OF EFFICIENT CONTRACTING DEMAND FOR FINANCIAL ACCOUNTING INFORMATION.............24
8.4 ACCOUNTING POLICIES FOR EFFICIENT CONTRACTING...............................................................................24
8.4.1 Reliability..............................................................................................................................................24
8.4.2 Conservatism........................................................................................................................................25
8.5 CONTRACTING RIGIDITY...............................................................................................................................25
Chapter 10 Executive Compensation............................................................................................................ 26
10.1 OVERVIEW..................................................................................................................................................26
10.2 ARE INCENTIVE CONTRACTS NECESSARY?.................................................................................................26
10.3 A MANAGERIAL COMPENSATION PLAN.....................................................................................................26
10.4 THE THEORY OF EXECUTIVE COMPENSATION...........................................................................................26
10.4.2 Short-run Effort and Long-run Effort..................................................................................................26
10.4.3 The Role of Risk in Executive Compensation......................................................................................26
10.7 THE POWER THEORY OF EXECUTIVE COMPENSATION..............................................................................26
Chapter 11 Earnings Management................................................................................................................ 28
11.1 OVERVIEW..................................................................................................................................................28
11.2 PATTERNS OF EARNINGS MANAGEMENT..................................................................................................28
11.3 EVIDENCE OF EARNINGS MANAGEMENT FOR BONUS PURPOSES............................................................29
11.4 OTHER MOTIVATIONS FOR EARNINGS MANAGEMENT.............................................................................29
11.5 THE GOOD SIDE OF EARNINGS MANAGEMENT.........................................................................................29
11.6 THE BAD SIDE OF EARNINGS MANAGEMENT............................................................................................29
11.7 CONCLUSIONS OF EARNINGS MANAGEMENT...........................................................................................29
Voordelen van het kopen van samenvattingen bij Stuvia op een rij:
Verzekerd van kwaliteit door reviews
Stuvia-klanten hebben meer dan 700.000 samenvattingen beoordeeld. Zo weet je zeker dat je de beste documenten koopt!
Snel en makkelijk kopen
Je betaalt supersnel en eenmalig met iDeal, creditcard of Stuvia-tegoed voor de samenvatting. Zonder lidmaatschap.
Focus op de essentie
Samenvattingen worden geschreven voor en door anderen. Daarom zijn de samenvattingen altijd betrouwbaar en actueel. Zo kom je snel tot de kern!
Veelgestelde vragen
Wat krijg ik als ik dit document koop?
Je krijgt een PDF, die direct beschikbaar is na je aankoop. Het gekochte document is altijd, overal en oneindig toegankelijk via je profiel.
Tevredenheidsgarantie: hoe werkt dat?
Onze tevredenheidsgarantie zorgt ervoor dat je altijd een studiedocument vindt dat goed bij je past. Je vult een formulier in en onze klantenservice regelt de rest.
Van wie koop ik deze samenvatting?
Stuvia is een marktplaats, je koop dit document dus niet van ons, maar van verkoper serenaesmee. Stuvia faciliteert de betaling aan de verkoper.
Zit ik meteen vast aan een abonnement?
Nee, je koopt alleen deze samenvatting voor €3,49. Je zit daarna nergens aan vast.
Is Stuvia te vertrouwen?
4,6 sterren op Google & Trustpilot (+1000 reviews)
Afgelopen 30 dagen zijn er 77254 samenvattingen verkocht
Opgericht in 2010, al 14 jaar dé plek om samenvattingen te kopen