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

Earnings Informativeness of Long-Lived Assets Impairment Recognized and Reversals 238 Model Non-reversals vs. Non-impairment Reversals vs. Non-impairment Reversals vs. Non-reversals Variables β β ( t -value) β ( t -value) β ( t -value) LEV t β 10 / β 11 -0.484 b (-2.03) -0.482 b (-2.17) -1.173 a (-3.09) MB t β 11 / β 12 0.355 a (15.67) 0.355 a (13.51) 0.552 a (4.19) SIZE t β 12 / β 13 0.067 b (1.98) 0.070 (1.55) 0.181 (0.90) Year Effect --- Included Included Included N 7,864 7,057 943 Adj R 2 67.00% 67.19% 51.18% F -statistic 12.54 a 11.48 a 2.69 a Hausman test 1233.82 a 1065.24 a 69.13 a Legends: 1. R t : a firm’s ex-dividend annual stock return in year t . X t-1 : a firm’s earnings per share excluding extraordinary items in year t -1, deflated by the stock price at the beginning of year t . X t : a firm’s earnings per share excluding extraordinary items in year t , deflated by the stock price at the beginning of year t . X t3 : a firm’s sum of earnings per share excluding extraordinary items for year t +1 through t +3, deflated by the stock price at the beginning of year t . R t3 : a firm’s annually compounded returns for year t +1 through t +3. IM t : a firm’s magnitude of long-lived assets impairment loss recognized in year t , deflated by the total assets at the beginning of year t . LEV t : a firm’s leverage measured as total debts divided by total assets of the sample firms at the end of the fiscal year. MB t : a firm’s market-to-book ratio measured as the market value of equity divided by book value of equity at the end of the fiscal year. SIZE t : a firm’s size measured by the natural logarithm of book value of total assets at the end of the fiscal year. 2. “a”, “b” and “c” denote the significance on 1%, 5% and 10% levels respectively, based on two- tailed tests.