Abstract
This paper investigates whether allowing firms to select the adoption year of new accounting standards has an influence on accounting behavior. Accounting standards for impairment of fixed assets became effective in 2006, but had a three-year adoption period. The magnitude of reported write-off is influenced by economic factors and earning management factors. Empirical analysis focuses on the difference between early adopters and late adopters to the relation of reported write-off and its determinants（economic factors and earning management factors）. Big bath, one of earnings management factors, is observed in early adopters and late adopters. Although income smoothing behavior is also observed in early adopters similar to prior research, it is diminished in late adoption year. This evidence indicates that write-off reported by late adopters is less reflective of earnings management factor relative to that by early adopters. The results further suggest that early adopters use selection of adoption year as the means of earnings management. In addition, association with reported write-off and economic factors of late adopters is weaker than that of early adopters.
