Accounting Papers

Document Type

Journal Article

Date of this Version

9-2001

Publication Source

Journal of Accounting and Economics

Volume

31

Issue

1-3

Start Page

3

Last Page

75

DOI

10.1016/S0165-4101(01)00029-5

Abstract

In this paper we critically evaluate the standard-setting inferences that can be drawn from value relevance research studies that are motivated by standard setting. Our evaluation concentrates on the theories of accounting, standard setting and valuation that underlie those inferences. Unless those underlying theories are descriptive of accounting, standard setting and valuation, the value-relevance literature's reported associations between accounting numbers and common equity valuations have limited implications or inferences for standard setting; they are mere associations. We argue that the underlying theories are not descriptive and hence drawing standard-setting inferences is difficult.

Copyright/Permission Statement

© 2001. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

accounting theory, standard setting, value relevance, valuation

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Date Posted: 27 November 2017

This document has been peer reviewed.