conservatism. 8 International Peter F. Pope , Analyze of the The sample consists of data This study compares The research Differences in Martin Walker † differences in the for all December fiscal conservatism of two presents several the Timeliness, 1999 timeliness of year-end nonfinancial measures of reported suggestions to Conservatism, income recognition firms listed in the U.S. earnings across the US measure accounting and between the U.S. (NYSE/AMEX) and UK and UK accounting conservatism in Classification of and U.K. GAAP (London Stock Exchange) regimes.. With the income recognition. Earnings financial reporting during 1976-1996. basis of the Basu model Mainly the regimes Resources: Datastream and (1997) they present a practitioners Compustat. 1999 formal model in which suggest that when the response of evaluating reported earnings to comparative changes in market conservatism, it is value varies according important to to whether the value capture two distinct change is good news or properties of bad. In this design they conservative present pooled results , accounting: delays annual cross-section in reporting good results, and write-offs news and early of large transitory recognition of bad losses were tolerated news. The results of in the research design the model show that the degree of conservatism displayed by earnings before extraordinary items under US GAAP was higher than under UK GAAP and the results also indicate that under US GAAP conservatism is
conservatism. 8 International Differences in the Timeliness, Conservatism, and Classification of Earnings Peter F. Pope , Martin Walker † 1999 Analyze of the differences in the timeliness of income recognition between the U.S. and U.K. GAAP financial reporting regimes The sample consists of data for all December fiscal year-end nonfinancial firms listed in the U.S. (NYSE/AMEX) and UK (London Stock Exchange) during 1976-1996. Resources: Datastream and Compustat. 1999 This study compares conservatism of two measures of reported earnings across the US and UK accounting regimes.. With the basis of the Basu model (1997) they present a formal model in which the response of reported earnings to changes in market value varies according to whether the value change is good news or bad. In this design they present pooled results , annual cross-section results, and write-offs of large transitory losses were tolerated in the research design The research presents several suggestions to measure accounting conservatism in income recognition. Mainly the practitioners suggest that when evaluating comparative conservatism, it is important to capture two distinct properties of conservative accounting: delays in reporting good news and early recognition of bad news. The results of the model show that the degree of conservatism displayed by earnings before extraordinary items under US GAAP was higher than under UK GAAP and the results also indicate that under US GAAP conservatism is