Abstract

http://ssrn.com/abstract=250813
 
 

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Accounting for the Impairment of Long-Lived Assets: Evidence from the Petroleum Industry


Mimi Alciatore


University of Houston - Department of Accountancy & Taxation

Peter D. Easton


University of Notre Dame - Department of Accountancy

Nasser Spear


University of Melbourne - Department of Accounting and Business Information Systems


Journal of Accounting and Economics, Vol. 29, No. 2, April 2000

Abstract:     
We investigate write-downs of assets of oil and gas firms due to the application of the SEC full-cost ceiling test during the period of the largest decline in oil and gas prices since this test was mandated. The correlation between the write-down amounts and contemporaneous returns is statistically significant, but it is lower than the correlation with lagged returns. This and other evidence suggests that, although the market perceived that some of the decline in asset value occurred in the quarter in which the write-down was recorded, much of the share market price adjustment due to this decline occurred earlier.

Keywords: Capital markets, Oil and gas, Value-relevance, SEC, Asset impairment

JEL Classification: M41, D21, G14, G38, N20, Q48, L71

Accepted Paper Series


Not Available For Download

Date posted: August 15, 2001  

Suggested Citation

Alciatore, Mimi and Easton, Peter D. and Spear, Nasser, Accounting for the Impairment of Long-Lived Assets: Evidence from the Petroleum Industry. Journal of Accounting and Economics, Vol. 29, No. 2, April 2000. Available at SSRN: http://ssrn.com/abstract=250813

Contact Information

Mimi Alciatore
University of Houston - Department of Accountancy & Taxation ( email )
Bauer College of Business
4800 Calhoun Road
Houston, TX 77204
United States
Peter D. Easton (Contact Author)
University of Notre Dame - Department of Accountancy ( email )
Mendoza College of Business
Notre Dame, IN 46556-5646
United States
574-631-6096 (Phone)
574-631-5127 (Fax)
Nasser Spear
University of Melbourne - Department of Accounting and Business Information Systems ( email )
Parkville, Victoria 3010
Australia
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