publication . Article . Other literature type . 1992

fixed asset revaluations and managerial incentives

BROWN, PHILIP; IZAN, H.Y.; LOH, ALFRED L.;
Restricted
  • Published: 01 Mar 1992 Journal: Abacus, volume 28, pages 36-57 (issn: 0001-3072, eissn: 1467-6281, Copyright policy)
  • Publisher: Wiley
Abstract
The study attempts to explain why Australian companies revalue their fixed assets, when a revaluation, by itself, has no discernible direct effect on cash flows and is costly to carry out. A revaluation is hypothesised to affect contracting and political costs. It may also help resolve problems associated with information asymmetries, or be used to signal information to investors. The results support the proposition that economic forces help explain the decision to revalue assets.
Subjects
free text keywords: Accounting, Financial economics, Economic forces, Valuation (finance), Incentive, Revaluation, Economics, Finance, business.industry, business, Cash flow, Politics, Fixed asset, Information asymmetry
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