THE ASSOCIATION BETWEEN THE QUALITY OF ACCRUALS AND CASH DIVIDENDS CONDITIONAL ON LOSSES

Ni-Yun Chen ； Chi-Chun Liu

《Advances in Quantitative Analysis of Finance and Accounting》 17期 (2019/12) Pp. 29-54

https://doi.org/10.6293/AQAFA.201912_(17).0002

摘要

The quality of accruals that contain information about expected cash flows is positively associated with the payment of cash dividends. However, dividends are less likely to be paid following losses. For the loss sample in this study, the results show that the association between the quality of accruals and the payment of dividends is more significantly positive when compared to the non-loss sample. The results indicate that firms with high quality of accruals favor using dividends to signal their financial credibility, particularly in the face of losses. However, firms with low quality of accruals tend to use those accruals to offset negative earnings, in reality with more negative earnings in turn decreasing the firms' ability to pay dividends.

關鍵字

Accruals ； Cash Dividends ； Losses ； Negative Earnings

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