Change search
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf
Big Bath and Impairment of Goodwill: A study of the European telecommunications industry
Jönköping University, Jönköping International Business School, JIBS, Business Administration.
Jönköping University, Jönköping International Business School, JIBS, Business Administration.
2016 (English)Independent thesis Advanced level (degree of Master (One Year)), 20 credits / 30 HE creditsStudent thesis
Abstract [en]

Income decreasing strategies conducted by management could be harmful for various stakeholders. One example is big bath accounting, which could be accomplished in numer- ous ways. This study focus on big baths achieved by recognising impairments of goodwill.

Purpose - The purpose of this study is to examine patterns of association between big bath accounting and impairment of goodwill within the telecommunication service industry in Europe. Further, this study aim at contributing to the discussion regarding utilisation of big baths through impairments of goodwill, and takes the perspective of an external stakehold- er.

Delimitations - The study is restricted to European telecommunication entities comprised in STOXX Europe 600 Index.

Method - This study was conducted using a hybrid of qualitative and quantitative research strategy with a deductive approach. The five indicators used to identify various big bath behaviours were inspired and derived from theory and previous research. Data from 2009 to 2015 was collected from the companies’ annual reports and websites, and analysed by the help of codification of each fulfilled indicator where 2009 merely served as a compara- tive year for 2010. By the use of a scoreboard the collected data was summarised on an ag- gregated yearly basis as the industry, not the specific companies, were analysed.

Empirical findings - The results of this study suggests that big baths are executed among tele- communication companies within Europe. These are conducted simultaneously as impair- ments of goodwill are present, facilitated by earning management. A possible explanation is considered to be the room for interpretation inherent in IAS 36, enabling goodwill impair- ments to be recognised on managers’ command. Thereby an impairment could be “saved” for better or worse circumstances, or recognised when there exist an opportunity to max- imise (the manager's) wealth in the future. This study reveal the co-occurrence of goodwill impairments and big bath-indications, however a review of causal relationships are not en- abled by the limitations of the chosen method. 

Place, publisher, year, edition, pages
2016. , 66 p.
Keyword [en]
Big bath, Impairment of goodwill, Earning management, Europe, Telecommunication industry
National Category
Business Administration
Identifiers
URN: urn:nbn:se:hj:diva-30097ISRN: JU-IHH-FÖA-2-20160399OAI: oai:DiVA.org:hj-30097DiVA: diva2:932088
Subject / course
IHH, Business Administration
Supervisors
Available from: 2016-05-31 Created: 2016-05-31 Last updated: 2017-06-20Bibliographically approved

Open Access in DiVA

fulltext(1008 kB)166 downloads
File information
File name FULLTEXT01.pdfFile size 1008 kBChecksum SHA-512
4724475684b8feda33992ea438db35d522ded28ec151b18a5b257ec36cb8b43842bc38b9c7cfa7e18c7700bd77b8058eb4317e41151a15126f28316efe3fbd96
Type fulltextMimetype application/pdf

By organisation
JIBS, Business Administration
Business Administration

Search outside of DiVA

GoogleGoogle Scholar
Total: 166 downloads
The number of downloads is the sum of all downloads of full texts. It may include eg previous versions that are now no longer available

urn-nbn

Altmetric score

urn-nbn
Total: 307 hits
CiteExportLink to record
Permanent link

Direct link
Cite
Citation style
  • apa
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf