On the persistent understatement of shareholder¿s equity around Europe
- Mora Enguídanos, Araceli
- García Lara, Juan Manuel
ISSN: 0210-2412
Año de publicación: 2003
Título del ejemplar: 26th Annual Congress of the EAA (Seville)
Número: 115
Páginas: 44-68
Tipo: Artículo
Otras publicaciones en: Revista española de financiación y contabilidad
Resumen
We examine the existence of balance sheet conservative practices by listed companies in seven European countries, analysing the differences among them. Our results show that in every country under study there are conservative practices that lead to a persistent understatement of operating assets with respect to market value. This understatement could be mainly attributable to the usage of historic cost accounting as well as to the non-recognition of certain intangible assets. We also find that in code-law based countries balance sheet conservative practices are much more pronounced. Additionally, we analyse whether our results are influenced by a different sample composition, and if spurious scale effects can drive them.