5外文及译文

外文文献翻译A Closer Look At Discretionary Writedowns Of Impaired AssetsThe increasing number of asset writedowns and write-offs during the last decade has captured the attention of both the financial press and the standard setting community. The FASB is currently considering regulation of writedowns of impaired assets and identifiable intangibles and released a Discussion Memorandum on the issues surrounding the problem in December 1990.Presently，there is little empirical research which applies directly to the writedowns which might be covered by the resulting standards (discretionary writedowns).Before any regulation by the FASB is attempted in this area, it would be beneficial for both standard setters and the business community to learn about those companies who have already chosen to record discretionary writedowns and the situations which may have prompted them to do so. Previous research in this area is not conclusive since some is based on anecdotal evidence and most of the published studies of writedowns include not only discretionary writedowns of impaired assets, but also write-offs and writedowns which may qualify as discontinued operations under APB 30.The purpose of this paper is to fill this void in the literature by providing information focusing only on discretionary asset writedowns. In particular, the following areas will be explored:1. What types of firms are recording discretionary asset writedowns? How prevalent are these events?2. How are discretionary asset writedowns disclosed?3. When are discretionary asset writedowns recorded? Are there any timing patterns in these events?4. What are the consequences of these writedowns? How do they affect stock prices and the financial health of the firms?THE CURRENT ENVIRONMENTAn asset is said to be "impaired" when its book value exceeds some measure of its "fair" value. When a firm recognizes this impairment and subsequently records the effect by decreasing the book value of the asset and debiting an income statement account, the firm has recorded a "writedown." GAAP clearly allows these writedowns in several situations. First, certain current assets, such as marketable securities and inventories, are examined periodically and adjusted to the lower of cost or market. Similarly, long term equity investments are adjusted periodically to the lower of cost or market although the income statement is not affected by the writedown. Finally, any long term assets for which disposal is contemplated (including assets being sold as part of a discontinued operation) are adjusted to their net realizable value (exit market value less costs of selling and readying for sale). These final types of writedowns are adequately addressed by APB 30, and there appears to be no confusion on the application of the rules to these situations, nor any reason to reassess APB 30 at this time.Most of the writedowns which a firm might normally record would fall into one of these three categories. The writedowns which the FASB would specifically target with their potential regulation would be those which do not. These will be termed "discretionary writedowns" to distinguish them from writedowns covered by APB 30. In these cases, the firm has not made a decision to dispose of the asset in question, but has come to the conclusion (based on their own decision model) that the asset is impaired. They plan to continue to use and depreciate the asset after the writedown, and do not indicate any current intent to sell the asset.Asset writedowns are often recorded in conjunction with, or under the title of, restructuring charges. Staff Accounting Bulletin No.67 (SAB 67), issued by the SEC in December 1986, deals with the display of restructuring charges on the income statement. The SEC concluded that restructuring charges should not be afforded extraordinary treatment. The FASB, however, has included disclosure as a "...separate line item outside continuing operations" as an option in their recently issued Discussion Memorandum, indicating that this treatment may be possible in their final standard. As a matter of policy, the Discussion Memorandum is subjected to SEC staffanalysis before issuance and an SEC observer is present at all Task Force meetings leading to the issuance of the Discussion Memorandum, so it is reasonable to assume that the SEC would rescind SAB 67 in the event that the FASB elected this treatment in a subsequent Statement of Financial Standards. Accordingly, this study looks at discretionary writedowns recorded during a period prior to the issuance of SAB 67 to determine management's preference for the income statement classification. SAB 67 is currently the only regulation which deals specifically with discretionary writedowns.The financial press has reported numerous cases of anecdotal evidence concerning writedowns and their impact on the financial health of the firm. For instance, several articles indicated that it appears that the stock market reacts positively to asset writedowns. A Wall Street Journal article indicated that the stock price for five large companies rose 4-7 percent three days after the announcement of "write-downs." Another article indicated that a $550 million "writedown" recorded by Warner Lambert in 1985 resulted in a 12 percent stock price increase. Unfortunately, none of these articles examine whether there may be a similar number of writedowns which resulted in stock price decreases. Another common theme in these articles is the surprise nature of the writedown and the failure of the writedown firms to "warn" the users of the financial statements in the periods before the writedown. None of these articles in the financial press distinguish between "writedowns" which are currently allowed under GAAP, and those which have been defined as "discretionary writedowns" in this paper.Four controlled studies of asset writedowns have been published, all of which include events other than "discretionary writedowns." Two of the interested parties in his topic, the Financial Executives Institute (FEI) and the National Association of Accountants (NAA) have each commissioned studies on asset impairments. Although extensive, neither of the studies specifically looks at only discretionary writedowns; these studies have included writedowns in contemplation of sale and total write-offs. The two published academic studies also include all types of write-offs and writedowns in their samples.''TIMING AND MOTIV ATIONAt the current time, partial writedowns of impaired long-lived assets are recognized at the discretion of management (and with the subsequent support of their auditors). Thus, it is important to investigate when management decides that the impairment should he recorded and what might motivate them to make such a decision. It is very difficult to assess the factors which might motivate a manager to record any discretionary event because of the manager's inability or reticence to describe the decision process. Often the researcher must draw conclusions from the available data to provide apparent motivating factors in the decision to record transactions. In this paper, earnings management will be examined as a possible explanation for the timing of and motivation for discretionary writedowns.By observing reported earnings surrounding the period in which the writedown was announced, two possible patterns of earnings management can be identified: income smoothing and “big baths." Income smoothing describes an earnings pattern in which management aspires to maintain a steady and predictable rate of earnings growth. Management may try to record discretionary gains, losses, or accruals in the period which will best help them to attain their goal of steady growth. This goal may he perceived as desirable because of a management incentive plan structured to reward smooth earnings patterns, or the hope that the market will equate smooth earnings with lower risk and subsequent higher stock prices. Thus, in the case of writedowns, a firm with an impaired asset may attempt to record the loss in a period of higher than normal earnings, or it may time the loss to coincide with a non-discretionary gain (for example, winning a substantial settlement in a lawsuit).A second form of earnings management has been referred to as the "big bath." Under this scenario, the firm appears to "save up" discretionary losses or accruals and then record several in the same period or in a period in which the firm has already experienced below normal earnings. Management might undertake a "big bath" to signal investors that "bad times" are behind them and better times will follow. In the case of discretionary asset writedowns, this reasoning is particularly appropriate since a writedown results in decreased depredation expense in the future. The "big bath" hasbeen mentioned often as a probable motivation for recording asset writedowns.To determine whether earnings management was a possible motivation in the timing of writedowns in this study, a measure of expected earnings was compared to reported earnings for each firm in the period in which the writedown was recorded. Income smoothing is characterized by periods in which pre-writedown earnings were higher than expected. By recording the writedown, reported earnings were closer to (but not less than) the level expected. A "big bath" is characterized by periods in which pre-writedown earnings were already below expected earnings. Thus, the firm recorded the writedown in a period in which other losses or accruals were already recorded or in a period of below normal operations.FINANCIAL CONSEQUENCES OF DISCRETIONARY WRITEDOWNS The financial consequences of recording discretionary writedowns of impaired assets can be assessed by observing certain financial indicators at the time of and after the writedown. Three specific indicators have been chosen in this study: (1) the reaction of the stock market, (2) the frequency of subsequent merger or acquisition activity, and (3) the subsequent financial health of the firms as measured by certain key ratios. Each of these three indicators will be discussed separately.Stock Market Reaction. The average stock returns of the writedown firms (adjusted for cash and stock dividends as well as firm-specific risk) were compared with the market return for a period of sixty days before to sixty days after the announcement of the writedown. On the average, there were no significant unusual or excess returns earned by the writedown firms over this period of time. In addition, they performed similarly to a control group of firms matched on the basis of industry and asset size over the same period of time.These results do not refute the anecdotal evidence that firms announcing discretionary writedowns have experienced unusual stock price increases. Rather, they indicate that for every firm that achieves these positive results, there is a firm for which the market acts negatively. Thus, a firm which records a writedown is just as likely to experience a negative market reaction as it is a positive market reaction.Subsequent Merger or Acquisition Activity. Some people in the business andacademic communities believe that a writedown may be an indicator of some sort of major capital structure change such as an acquisition of, acquisition by, or a merger with another similarly sized organization. To investigate this contention, each writedown firm was observed from the writedown date through the end of 1987 for evidence of merger or acquisition activity, and the results were compared with those of firms in similar industries and of similar asset size.The results indicate that a greater number of the writedown firms engage in subsequent mergers or acquisitions than do firms in similar industries and of similar size which do not record writedowns. However, a chi-squared test found that the frequency of subsequent merger or acquisition activity is not significantly higher (at a 0.05 level of significance) for the writedown firms. This means that the apparent differences could be due to chance. There is no statistical evidence to support the contention that firms recording discretionary writedowns of impaired assets are more likely to engage in subsequent merger or acquisition activity.Subsequent Financial Health. Tb evaluate the comparative financial health of the writedown and control firms in the periods surrounding the writedown, four financial variables, (1) Cash Dividend Growth, (2) Earnings/Price Ratio, (3) Debt to Equity Ratio, and (4) Quarterly Return on Assets, were measured at six points in time over the period of three years before to three years after the writedown. The period in which the writedown was recorded is not included because of its obvious impact on the financial variables and to provide a clearer view of the long term trend of each variable. In addition, because of the diverse range of relative size of the writedowns, the writedown firms were split into two groups based on the size of the writedown as a percentage of total assets of the firm. Splitting the writedown group in this manner will allow for the observation of the impact of the writedown size on the firm's subsequent financial health. These two groups will be referred to as large and small writedowns.SUMMARY AND CONCLUSIONSThere are several conclusions that can be drawn from the results of these empirical tests of discretionary writedowns of impaired assets. First, the number ofevents located during the test period of 1981 to 1983 is low. This observation may indicate two different situations. First, asset impairments not already covered by GAAP could be infrequent. Second, and probably more realistic, the number of partial impairments may be significant, but, given the paucity of specific regulatory guidance or requirement, the writedowns are not being recorded. This second situation has particular implications for the standard setting community since it makes it difficult to estimate the impact of potential regulation. The firms recording writedowns tend to be in capital-intensive industries and tend to be traded on the New York Stock Exchange. The writedowns also vary in absolute and relative size, again perhaps reflecting the deficiencies in guidance on what comprises impairment.Second, the writedowns occur primarily in the fourth quarter of the fiscal year, probably because of the more extensive review due to the budgeting and audit processes occurring in that period. Management tends to view the writedowns as unusual events and highlights them as separate line items after income from operations. However, even in a period preceding the SEC's prohibition of extraordinary income statement treatment, none of the firms disclosed the writedown after continuing operations.Third, the majority of the firms wrotedown their assets in a period of already below normal earnings (a "big bath"), but 25 percent offset the writedown with other gains or unusually high earnings (income smoothing).These results provide support for the contention that writedowns are being used to manage earnings. Finally, the writedowns are not a precursor of improved financial health for the firm. No significant evidence of positive stock market reaction to the writedown announcement could be found. There is no significant increase in merger or acquisition activity for writedown firms as compared to a control group of firms. In general, control firms outperformed writedown firms on the basis of key financial characteristics. In addition, the larger the writedown as a percentage of assets, the larger the decline in financial health. For those firms which did decide to record partial writedowns despite the lack of specific regulatory requirements, this study indicates a less than positive picture. Recording the writedown as a fourth quarter adjustment without "warning,"evidence of earnings management, and finally declining financial health which intensifies as the relative size of the writedown increases are all contradictory to the impression often given by the financial press, and perhaps management itself, that the writedown is a positive event which will result in increased stock prices and a healthier firm. For the standard setters, it provides a dilemma since it is impossible to determine how many firms actually have impaired assets but have so far elected not to record the writedown. The FASB must decide, first of all, the magnitude of the potential problem and then when to require partial writedowns of impaired long-lived assets. Once these decisions have been made, then the substantive issues of measurement and disclosure can be addressed.Linda J. Zucca, David R. Campbell. A Closer Look At Discretionary Writedowns Of Impaired Asserts [J].Accounting Horizon, 1992, 6(3): 30-41.译文：对减记资产减值的研究在过去十年里，资产减记和注销数目的不断增加，已经引起了金融媒体和标准设置委员会的关注。