Revenue recognition in a multiperiod agency setting
成果类型：
Article
署名作者：
Dutta, S; Zhang, XJ
刊物名称：
JOURNAL OF ACCOUNTING RESEARCH
ISSN/ISSBN：
0021-8456
DOI：
10.1111/1475-679X.00039
发表日期：
2002
页码：
67-83
关键词：
摘要：
This paper examines how various revenue recognition rules affect the incentive properties of accounting information in a stewardship setting. Our analysis demonstrates that if revenues are recognized according to the realization principle, a single performance measure based on aggregated accounting information can be used to provide desirable production and effort incentives to the manager. In contrast, mark-to-market accounting does not provide efficient aggregation of raw information to solve the stewardship problem. Mark-to-market accounting, though sensible from a valuation perspective, fails to provide desirable incentives because it relies on the anticipated, rather than the actual, performance of the manager. We also consider a setting in which the manager can control the timing of the firm's sales. It then becomes desirable to modify the realization principle and apply the lower-of-cost-or-market valuation rule. The desirable accounting thus exhibits a conservative bias.
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