DeFond and Park (1997) find that, o

DeFond and Park (1997) find that, on the onehand, when current earnings are çpooré andexpected future earnings are çgoodé, managersborrow earnings from the future for use in the currentperiod. On the other hand, when current earnings areçgoodé and expected future earnings are çpoorémanagers çsaveé current earnings for possible use inthe future. This is called çsmoothing incomeé.However, they cannot exclude selection bias inexplanation their findings

DeFond and Park (1 997) Find that, on the one
Hand, when current earnings are Çpooré and
Future earnings are expected Çgoodé, Managers
Borrow earnings from the Future for use in the current
period. On the Other Hand, when current earnings are
expected Çgoodé and Future earnings are Çpooré
Managers Çsaveé current earnings for possible use in
the Future. This is Called Çsmoothing Incomeé.
However, they Can not exclude selection bias in
their findings explanation.

DeFond and Park (1997), find that on the one
hand when current, earnings are ç poor é and
expected future earnings are ç, good cafe. Managers
borrow earnings from the future for use in the current
period. On the other hand when current, earnings are
ç good é. And expected future earnings are ç poor é
managers ç save é current earnings for possible use in
the future. This is called. ç smoothing income é.
, HoweverThey cannot exclude selection bias in
explanation their findings.