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Abstracts prior to volume 5(1) have been archived!

Issue 5(1), October 2010 -- Paper Abstracts
Girard  (p. 9-22)
Cooper (p. 23-32)
Kunz-Osborne (p. 33-41)
Coulmas-Law (p.42-46)
Stasio (p. 47-56)
Albert-Valette-Florence (p.57-63)
Zhang-Rauch (p. 64-70)
Alam-Yasin (p. 71-78)
Mattare-Monahan-Shah (p. 79-94)
Nonis-Hudson-Hunt (p. 95-106) 



JOURNAL OF ACCOUNTING AND FINANCE 


Portfolio Management and Earnings Management: Evidence from Property and Casualty Insurers

Author(s): R. Mark Alford, Kimberly F. Luchtenberg, Willie Dion Reddic

Citation: R. Mark Alford, Kimberly F. Luchtenberg, Willie Dion Reddic, (2018) "Portfolio Management and Earnings Management: Evidence from Property and Casualty Insurers",  Journal of Accounting and Finance, Vol. 18, ss. 4, pp.30-43

Article Type: Research paper

Publisher: North American Business Press

Abstract:

When underwriting losses occur, Property and Casualty (P&C) managers may exercise discretion on
both sides of the balance sheet – rebalancing assets and/or adjusting loss reserves. We investigate
whether asset (portfolio) management and loss reserve management are endogenous. P&Cs usually
maintain a conservative investment posture. However, we find that when P&Cs have underwriting losses a positive association exists between portfolio management and earnings management. We provide evidence supporting the income smoothing and tax hypotheses for P&C’s discretionary loss reserve errors - an area of much debate in the recent literature.