Measuring accounting conservatism for listed companies in Amman stock exchange (ASE)‎ during the period 2001–2010

Abstract EN

This paper aimed to measure accounting conservatism for listed companies in the Amman stock Exchange (ASE) from the period 2001 to 2010.

The sample of the study includes listed firms from three main sectors: manufacturing, banking and service.

The paper applied a model developed by Basu (1997) to measure conservatism based on several events and circumstances.

Results show that listed companies report their financial reports using a certain degree of conservatism.

Results also show that companies reporting a loss or reversing their losses use less conservative practices in order to report profits.

The paper also provides evidence that the level of conservatism changes according to the companies’ industry classification.

Moreover, the results show that companies became less conservative in their financial reporting after the financial crisis.