The rise and demise of abnormal items
Before 2001, Australian companies reported abnormal items on the face of the income statement or by way of note. In response to perceived abuses in classifying items as abnormal, AASB 1018 was reissued in October 1999 with the reference to abnormal items removed. We analyse the implications of the changes to accounting standard requirements relating to abnormal items, and examine whether there is empirical evidence of opportunistic classification of operating profit items as abnormal. Our results suggest that some companies may have opportunistically classified large expense items as "abnormal" to boost their reported "normal" earnings number.
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|Item Type:||Journal Article|
|Keywords:||Financial reporting, Accounting standards, Abnormal items, Special items, Earnings management|
|Subjects:||Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > ACCOUNTING AUDITING AND ACCOUNTABILITY (150100) > Financial Accounting (150103)|
|Divisions:||Current > QUT Faculties and Divisions > QUT Business School|
|Copyright Owner:||Copyright 2008 Blackwell Publishing|
|Copyright Statement:||The definitive version is available at www.blackwell-synergy.com|
|Deposited On:||30 Apr 2008|
|Last Modified:||29 Feb 2012 23:41|
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