臺大管理論叢 NTU Management Review VOL.29 NO.1

233 NTU Management Review Vol. 29 No. 1 Apr. 2019 5.3 The Tiny Assets Impairment Consideration This study rounds IM variable values below 0.1% to zero in the initial analysis, thus magnitude of assets recognized as impaired is unlikely to have a significant impact on earnings. To obtain confirmatory evidence to support our empirical findings, we restore the initial recognized impairment and rerun the regressions. The empirical results from these additional tests are presented in Table 8. From the IM model in Table 8, the coefficients of IM t *X t and IM t *X t3 are respectively -10.040 ( t = -5.07) and 2.051 ( t = 2.26), both statistically significant. The coefficients of IM t *X t and IM t *X t3 are respectively -10.589 ( t = -5.50) and 2.084 ( t = 2.58) in the REV model, both statistically significant at the 1% level. These results again indicate the informativeness of current earnings (future earnings) decrease (increase) when firms recognize the impairment loss of long-lived assets. The coefficient of REV t *IM t *X t3 is -3.687 ( t = -0.38), which is negative and statistically insignificant. The combined coefficient of IM t *X t3 and REV t *IM t *X t3 ( β 8 +β 13 ) is -1.603 ( t = -0.16), again negative and statistically insignificant. This study also excludes 299 tiny asset impairment observations and uses the remaining 7,633 observations to examine the hypotheses. The untabulated results reveal that the coefficients of IM t *X t and IM t *X t3 are respectively -10.249 ( t = -6.01), 1.896 ( t = 2.03) and -11.484 ( t = -5.28), 2.742 ( t = 2.88) in the IM and REV models, which are all statistically significant. The coefficients of REV t *IM t *X t and REV t *IM t *X t3 are respectively 34.698 ( t = 1.72) and -16.774 ( t = -1.66), both marginal statistically significant. However, the combined coefficient of IM t *X t3 and REV t *IM t *X t3 ( β 8 +β 13 ) is -14.032 ( t = -1.35), which is negative and statistically insignificant. Thus, the results are robust given the tiny amount of asset impairment.