modified jones model vs standard jones model


Joined
May 12, 2022
Messages
1
Reaction score
0
Country
Netherlands
I have a question regarding earnings management measurement models jones and modified jones model. I’m studying the effect of IFRS 15 on earnings management and I think that to study a change in a revenue recognition standard in relation to earnings management the modified Jones model would be a better model, since the jones model shows that revenues aren't discretionary, while there is a risk that revenues can be realized sooner or later due to discretion. And since IFRS 15 is a revenue recognition standard and some prior studies show that there is more freedom in recognizing the revenue, the modified Jones model would be better. I’ve got the following feedback: “The modified Jones model removes all additional credit sales from the revenues to calculate normal accruals - why exactly would this matter more under IFRS 15 than otherwise?”
And I’m not really sure how to answer this
 
Ad

Advertisements


Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Similar Threads

Modified Altamn's model 4
Edward Jones 2
Dow Jones Index Options 0
FTSE 100, Dow Jones, etc 1
Finding Old Dow Jones figures 2
Spreadsheet modelling 4
Object Model 1
Model Quantity 0

Top