 How does changing measurement change management behaviour? A review of the evidenceAnne Beatty Accounting and Business Research, 2007, vol. 37, issue S1, 63-71 Abstract: The effect of a change in accounting standards on reporting firms' economic behaviour is often a concern raised by those opposing the accounting change. Some view these changes in behaviour as an inevitable consequence of a rule change. Others are not persuaded by these arguments. Although the empirical evidence of changes in economic behaviour is not extensive, it is consistent with accounting changes resulting in firms changing both operating and financing decisions. The evidence of which economic incentives give rise to these changes is more limited. Changes in economic behaviour appear consistently to be related to the regulatory use of accounting numbers. In addition, some evidence related to incentives created by management compensation and by market discipline has been found. Evidence of the importance of debt covenants in inducing accounting changes is less convincing given limited examination of actual debt contracts and the use of poor proxies of covenant slack. The existing research does little to tell us whether any changes in behaviour are for the better or for the worse. Date: 2007 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:acctbr:v:37:y:2007:i:s1:p:63-71 Ordering information: This journal article can be ordered from DOI: 10.1080/00014788.2007.9730086 Access Statistics for this article Accounting and Business Research is currently edited by Vivien Beattie More articles in Accounting and Business Research from Taylor & Francis Journals |
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