Accrual Quality Assessment Model in Banking Industry
Subject Areas : Journal of Investment KnowledgeGholamhossein Assadi 1 , Bahador Nayebi 2
1 - Associate Prof., Faculty of Management & Accounting, Shahid Beheshti University, Tehran, Iran
2 - Ph.D. Student in Accounting, University of Tehran – Kish International Campus, Iran
(Corresponding author)
Keywords: Banks&, rsquo, Balance Sheet Cat, Accruals Quality, Capital Adequacy, Loan Contract, Future-based Earning Managemen,
Abstract :
This paper provides a new categorization of balance sheet items for commercial banks by putting them in to financial and operational parts. Results of the study shows that banks with higher net financial assets compared to net operational assets have less incentives for earnings management, which results in higher accruals quality. Furthermore, we have studied the role of loan contract types and capital adequacy on accruals quality. The results show that banks with higher share of fixed-income loan contracts and higher capital adequacy ratio have a better quality of accruals. We also found out that banks which give loans to corporations of leading industries, have less earning management actions, which leads to higher accruals quality. Based on this finding, we have developed a future-looking measure of accruals quality for banks focused on industries which banks put higher portion of the loans on and called it Portfolio Quality Index (PQI).
* احمدپور, ا., احمدی, ا. (1387). استفاده از ویژگیهای کیفی اطلاعات مالی در ارزیابی کیفیت سود. بررسیهای حسابداری و حسابرسی, 3-16.
* رحمانی, ع., رامشه, م. (1392). رابطة جایگزینی میان مدیریت سود مبتنی بر اقلام تعهدی و مدیریت فعالیت های واقعی. بررسیهای حسابداری و حسابرسی, 39-60.
* رضازاده, ج., گروسی, ح. (1390). پایداری تفاضلی اجزای تعهدی و نقدی سود و پیش بینی سودآوری. بررسیهای حسابداری و حسابرسی, 81-94.
* سپهردوست, ح., آئینی, ط. (1392). بررسی عوامل مؤثر بر نسبت کفایت سرمایه در بانک های ایران طی سالهای 89-85. پزوهشهای حسابداری مالی, 35-50.
* محرابی, ل. (1392). عملکرد ابزارهای تأمین مالی در نظام بانکداری بدون ربا در ایران. تازههای اقتصاد.
* Ahmed, A. S., Takeda, C., & Thomas, S. (1999). Bank loan loss provisions: a reexamination of capital management, earnings management and signaling efects. Journal of Accounting and Economics, 1-25.
* Balla, E., & Rose, M. J. (2015). Loan loss provisions, accounting constraints, and bank ownership structure. Journal of Economics and Business, 92-117.
* Cheng, Q., Warfield, T., & Ye, M. (2011). Equity incentives and earnings management: evidence from the banking industry. Journal of Accounting, Auditing & Finance, 317-349.
* Dechow, P. M., Sloan, R. G., & sweeny, A. P. (1995). Detecting earnings management. The Accounting Review, 193-225.
* Dechow, P. M., & Dechev, D. I. (2002). The quality of accruals and earnings: The role of accrual estimation Errors. The Accounting Review, 35-59.
* Fairfield, P. M., Whisenant, J. S., & Yohn, T. L. (2003). Accrued Earnings and growth: implications for future profitability and market mispricing. The Accounting Review, 353-371.
* Gujarati, D.N. (1995) Basic Econometrics. 4th Edition, United State Military Academy, New York.
* Kothari, S. (2001). Capital market research in accounting. Journal of Accounting and Economics, 105-231.
* Richardson, S. A., Sloan, R. G., Soliman, M. T., & Tuna, I. (2005). Accrual reliability, earnings persistence and stock prices. Journal of Accounting and Economics, 39, 437–485.
* sloan, R. G. (1996). Do stock prices fully reflect information in accruals and cashflows about future earnings? The Accounting Review, 289-315.
* Uysal, A. (2013). Assessing accrual quality in financial institutions. PhD Dissertation. Berkeley: University of California.
_||_