Conditional conservatism is an integral but often unmodeled part of the normal accrual process. The standard economic determinants of accruals contain information about unrealized losses. We argue that accountants recognize these unrealized losses as disaggregated write-downs for small asset...

We re-examine the question why large positive and large negative book-tax differences (LPBTDs and LNBTDs) are associated with lower earnings persistence (Hanlon, 2005). Specifically, we investigate whether lower earnings persistence of LPBTD firms and LNBTD firms, relative to firms in the middle...