Accruals


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Accruals

On a balance sheet, an expense or asset that is recognized before it is paid. Accruals are recorded as liabilities or assets (depending on the type) and are recognized because of the extremely high likelihood of payment. Accruals are generally periodic payments; examples include salaries and accounts receivable from well-known customers. They are recorded as "accrued" on a balance sheet on the date the payment begins to be expected; they remain in this section of the balance sheet until they are actually paid.
References in periodicals archive ?
Dichev, 2002, The Quality of Accruals and Earnings: The Role of Accrual Estimation Errors, The Accounting Review, 77(Supplement): 35-59.
Schipper, 2005, The Market Pricing of Accruals Quality, Journal of Accounting and Economics, 39: 295-327.
Dichaw Dichoo studied the role of accruals in order to measure the companies' performance better in a time series.
In their research Francis et al state that accruals are the diagnostic criteria for the ambiguity existed in the company's future cash flow.
First and foremost, this is the first study that provides direct evidence on agency costs and overvalued equity mediating the association between accruals/long-term asset accruals and firm performance.
If asset accruals entail more subjectivity and measurement error than liability accruals, they could be easier targets for earnings management.
00 Build 549, which includes a significant upgrade to its accrual engine.
Students realize that the difference between the cash basis and accrual basis is the treatment of these other assets and liabilities.
Sloan (1996) empirically identified that investors tend to overvalue accruals in forming expectations about the future earnings of U.
The academic literature has studied earnings management through the manipulation of discretionary accruals (e.
Consistent with the earnings management hypothesis, we find strong evidence to suggest that firms with large negative changes in operating cash flows manage their accruals substantially upward, while those with large positive changes in operating cash flows manage their accruals significantly downward.