[Home ] [Archive]   [ فارسی ]  
:: Main :: About :: Current Issue :: Archive :: Search :: Submit :: Contact ::
Main Menu
Home::
Journal Information::
Articles archive::
For Authors::
For Reviewers::
Registration::
Contact us::
Site Facilities::
::
Search in website

Advanced Search
..
Receive site information
Enter your Email in the following box to receive the site news and information.
..
:: year 12, Issue 45 (2020) ::
fa 2020, 12(45): 1-29 Back to browse issues page
The Effect of Optimism and Riskseeking Level of Managers on Investment Selling Decisions with Emphasis on Fair Value Accounting
Mohammad Alimoradi , Saeid Aliahmadi * 1, Daruosh Foroghi
Abstract:   (4927 Views)
The purpose of this study was to investigate the effect of managers' optimism and riskseeking level on investment selling decisions with emphasis on fair value accounting. The requirement to apply International Financial Reporting Standards and third-level discretion of fair value requires to review the behavior of managers regarding the effect of the level of optimism and their riskseeking on the investment selling decisions based on fair value. The research method is applied in terms of the target, analytical of the kind of quasi-experimental in terms of the nature and survey in terms of data collection method. The statistical population consists of all active financial analysts in the capital market and statistical sample includes 268 financial analysts which were selected by targeted sampling method. The period of research is 2018. To collect data, we were used a questionnaire based on the scenario. The results of this study showed that the level of optimism and riskseeking of managers does not have a significant effect on the investment selling decisions based on fair value. the level of conservatism applied to the assessment of fair value affects investment selling decisions, but the level of fair value volatility does not affect the decisions made. In addition, the level of optimism and riskseeking of managers does not affect the relationship between the level of conservatism and fair value volatility with investment selling decisions.
 
Keywords: fair value accounting, investment decisions, decision makers' optimism, decision makers riskseeking.
Full-Text [PDF 1119 kb]   (940 Downloads)    
Type of Study: Research | Subject: Special
References
1. Ball, R., Kothari, S. P., & Robin, A. (2000). The effect of international institutional factors on properties of accounting earnings. The Journal of Accounting & Economics, 29: 1-51.
2. Barron, O. E., Chung, S. G., & Yong, K. O. (2016). The effect of Statement of Financial Accounting Standards No. 157 Fair Value Measurements on analysts’ information environment. Journal of Accounting and Public Policy, 35(4), 395-416.
3. Bazerman, M. H., & Moore, D. A. (2008). Judgment in managerial decision making. 8th Edition, John Wiley & Sons, Inc.
4. Bourgeois, L. J. (1985). Perceived uncertainty, and economic performance in volatile environments. Academy of Management Journal, 28: 548-573.
5. Baucells, M., Weber, M., & Welfens, F. (2011). Reference-point formation and updating. Management Science, 57: 506-519.
6. Barth, M. E., Landsman, W. R., & Wahlen, J. M. (1995). Fair value accounting: Effects on banks' earnings volatility, regulatory capital, and value of contractual cash flows. Journal of Banking & Finance, 19: 577-605.
7. Chen, W., Tan, H.-T., & Wang, E. Y. (2013) Fair value accounting and managers' hedging decisions. Journal of Accounting Research, 51(1): 67-103.
8. Cohen,L., Manion, L. and Morrison. (2000). Research Methods in Education by Routledge Falmer. 5th edition.
9. Dechow, P. M., Myers, L. A., & Shakespear, C. (2010). Fair value accounting and gains from asset securitization: A convenient earnings management tool with compensation sidebenefits. Journal of Accounting and Economics, 49: 2-25.
10. Dixit, A. K., & Pindyck, R. S. (1994). Investment Under Uncertainty. Princeton, NJ: Princeton University Press.
11. Eisenhardt, K. M. (1989). Agency theory: An assessment and review. The Academy of Management Review, 14(1): 57-74.
12. Fiechter,P. and Novotny-Farkas, Z., (2017), "The impact of the institutional environment on the value relevance of fair values", Review of Accounting Studies, Issue 1.
13. Grable, J., & Lytton, R. H. (1999). Financial risk tolerance revisited: The development of a risk assessment instrument. Financial Sendees Review, 8, 163-181.
14. Green, Karen Y., Wier, B., Brink, Alisa G., Norman, C., Gooden, E. and Kepes, S. (2015), Can Fair Value Accounting Create a Cognitive Bias? The Effects of Recognized Level 3 Fair Value on Manager Selling Decisions, A dissertation proposal submitted in partial fulfillment of the requirements for the degree of Doctoral of Philosophy in Business at Virginia Commonwealth University.
15. Henrick, B. (2001). Positive emotion and its effects on coping with life changes. Journal of Health psychology, 33(4):99-107.
16. Hirst, E., Hopkins, P. E., & Wahlen, J. M. (2004). Fair values, income measurement, and bank analysts' risk and valuation judgments. The Accounting Review, 79: 453-472.
17. IFRS 13. (2012). IFRS 13.1.
18. Kadous, K., Koonce, L., & Thayer, J. M. (2012). Do financial statement users judge relevance based on properties of reliability? The Accounting Review, 84: 1335-1356.
19. Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47: 263-291.
20. Kedia, S., & Philippon, T. (2009). The economics of fraudulent accounting. Journal of Financial Regulation, 22: 2169-2199.
21. Kunda, Z. (1990). The case for motivated reasoning. Psychological Bulletin, 108: 480-498.
22. Lefcort, S. (2001). Emotion and action, London, Oxford press.
23. Lobo, G. J., & Zhou, J. (2006). Did conservatism in financial reporting increase after the Sarbanes-Oxley Act? Initial evidence. Accounting Horizons, 20: 57-73.
24. Lachmann, M., Wöhrmann, A. and Wömpener, A., (2011) "Acquisition and integration of fair value information on liabilities into investors' judgments", Review of Accounting and Finance, Vol. 10 Issue: 4, pp.385-410.
25. Milbradt, K. (2012). Level 3 assets: Booking profits and concealing losses. The Review of Financial Studies, 25: 55-95.
26. March, J., & Shapira, Z. (1987). Managerial perspectives on risk and risk taking. Management Science, 33: 1404-1418.
27. Mishra, H., Mishra, A., Rixom, J., & Chatterjee, P. (2013). Influence of motivated reasoning on saving and spending decisions. Organizational Behavior and Human Decision Processes, 121: 13-23.
28. Penman, S. (2007). Financial reporting quality: Is fair value a plus or minus? Accounting and Business Research, Special issue: International Accounting Policy Forum: 33-44.
29. Peterson, H. (2004). Mood and Life challenges. New- York. Hillbrook press.
30. Sapkauskiene, A., & Orlovskij, S. (2017). The usefulness of fair value estimates for financial decision making–a literature review. Zeszyty Teoretyczne Rachunkowości, (93 (149)), 163-173.
31. Scheier, M. F., Carver, C. S., & Bridges, M. W. (1994). Distinguishing optimism from neuroticism (and trait anxiety, self-mastery, and self-esteem): A reevaluation of the Life Orientation Test. Journal of Personality and Social Psychology, 67: 1063-1078.
32. Scheier, M.F., Carver, C.S. (1985). Optimism, coping, and health: Assessment and implications of generalized outcome expectancies. Health Psychology, 4, 219-247.
33. Zamora-Ramirez, C. and Morales-Diaz, J. (2018). The Use of Fair Value Measurement in Financial Reporting: A Literature Review, ESTUDIOS DE ECONOMÍA APLICADA, VOL. 36 - 2 2018, PÁGS. 489 – 514.
34. Zyla, L. M. (2013). Fair Value Measurement: Practical Guidance and Implementation. Hoboken, New Jersey: John Wiley & Sons, Inc.
35. Birnberg, J. G. (2011). A Proposed Framework for Behavioral Accounting Research (23): 1-43.
36. Beyer, A., D. Cohen, T. Lys, and B. Walther. (2010).The Financial Reporting Environment: Review of the recent literature. Journal of Accounting and Economics, 50 (2): 296-343.
37. Forgas, J. P. (1995). Mood and Judgment: The Affect Infusion model (AIM), Psychological Bulletin,
38. . Car, A. (2004). Positive Psychology, The Science of Happiness and Human Strengths, New York, Brunner Rout ledge Let.117(1), 39–66
39. Coget, J. F., Haag, C. & Gibson, D. E. (2011). Anger and Fear in Decision Making: The Case of Film Directors on Set. European Management Journal, 29(6), 476–490
40. Chung, S., Goh, B., Ng, J., & Yong, K. (2015). Voluntary fair value disclosures beyond SFAS 157’s three-level estimates. Working Paper, Research Collection School of Accountancy.
41. Beyer, A., D. Cohen, T. Lys, and B. Walther. (2010).The Financial Reporting Environment: Review of the recent literature. Journal of Accounting and Economics, 50 (2): 296-343.
42. Fallah Shams, M., GhalibafAsl, H. & Nobakht , S. (2011). The Impact of Experience on Risktaking, Overconfidence and Herding of Investment Companies’ Managers in Tehran Stock Exchang. Quarterly Journal of Securities Exchange, 3(12), 25-42.
43. Grable, J., & Lytton, R. H. (2001). Assessing The Concurrent Validity Of The SCF Risk Tolerance Question. Financial Counseling and Planning. 12(2), 43-53.
44. Goh, B., Li, D., Ng, J., & Yong, K. (2015). Market pricing of banks’ fair value assets reported under SFAS 157 during the 2008 economic crisis. Journal of Accounting and Public Policy, 34(2), 129-145
45. Kahneman, D., & Tversky, A. (1973). On the psychology of prediction. Psychological Review, 80(4): 273-251.
46. Lee, B., Rosenthal, L., Veld, C. and Veld-Merkoulova, Y. (March 2, 2015). Stock Market Expectations and Risk Aversion of Individual Investors Available at SSRN: https://ssrn.com /abstract=2392227 or http://dx.doi.org/10.2139/ ssrn.2392227
47. Loewenstein, G., & Lerner, J. S. (2003). The Role of Affect in Decision Making, in R. Davidson, K. Scherer and H. Goldsmith (eds), Handbook of Affective Science. Oxford, UK: Oxford University Press
Send email to the article author

Add your comments about this article
Your username or Email:

CAPTCHA


XML   Persian Abstract   Print


Download citation:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:

Alimoradi M, Aliahmadi S, Foroghi D. The Effect of Optimism and Riskseeking Level of Managers on Investment Selling Decisions with Emphasis on Fair Value Accounting. fa 2020; 12 (45) :1-29
URL: http://qfaj.mobarakeh.iau.ir/article-1-1871-en.html


Rights and permissions
Creative Commons License This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
year 12, Issue 45 (2020) Back to browse issues page
فصلنامه حسابداری مالی Quarterly Financial Accounting
Persian site map - English site map - Created in 0.05 seconds with 37 queries by YEKTAWEB 4679