Optimal accounting policies under financial constraints: Aggressive versus conservative

Masatomo Akita, Yusuke Osaki

Research output: Contribution to journalArticle

Abstract

We examine how severity of financial constraints influences firms' choices of accounting policies. This paper shows that firms with mild financial constraints choose an aggressive accounting policy and those with severe financial constraints choose a conservative accounting policy.

Original languageEnglish
Pages (from-to)3179-3191
Number of pages13
JournalEconomics Bulletin
Volume31
Issue number4
Publication statusPublished - 2011

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

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