BALL, RAY; SHIVAKUMAR, LAKSHMANAN - In: Journal of Accounting Research 44 (2006) 2, pp. 207-242
We investigate the role of accrual accounting in the asymmetrically timely recognition (incorporation in reported earnings) of gains and losses. Timely recognition requires accruals when it precedes complete realization of the gains and losses in cash. We show that nonlinear accruals models...