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Type: Journal article
Title: Valuation of family firms: the limitations of accounting information
Author: Hasso, T.
Duncan, K.
Citation: Australian Accounting Review, 2013; 23(2):135-150
Publisher: Wiley-Blackwell
Issue Date: 2013
ISSN: 1035-6908
Statement of
Tim Hasso, Keith Duncan
Abstract: This conceptual paper explores the extent to which reported accounting information captures unique family firm decision-making and intangible asset factors that impact financial value. We review the family firm valuation-relevant literature and identify that this body of research is predicated on the assumption that accounting information reflects the underlying reality of family firms. This research, however, fails to recognise that current accounting technology does not fully recognise the family firm factors in the book value of the firm or the implications for long-run persistence of earnings. Thus, valuation models underpinning the extant empirical research, which are predicated on reported accounting information, may not fully reflect the intrinsic value of family firms. We present propositions on the interaction between accounting information, family factors and valuation as a road map for future empirical research with a discussion of appropriate methodologies.
Rights: © 2013 CPA Australia
DOI: 10.1111/j.1835-2561.2013.00202.x
Appears in Collections:Aurora harvest 7
Business School publications

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