Accounting conservatism and corporate social responsibility have received much attention in the recent literature. The current study draws upon Watts, who recognizes that one role of conservatism is to reduce the likelihood of excess wealth transfers to its stakeholder groups and Post et al., who assert that a key aspect of positive corporate social performance is the (equitable) distribution of corporate wealth. Accordingly, this study empirically investigates and finds a positive relation between conservatism and strong social performance.

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Purpose -The purpose of this paper is to generate empirical evidence that facilitates our understanding of the market pricing for cash flows and accruals. Design/methodology/approach -The study is empirical in nature, and utilizes and archival methodology. Findings -The evidence in this study supports the primary hypothesis that the market valuations for the receivable accrual are greater than the valuations for other current accruals. Additionally, the results suggest that market valuations for cash flows are not monotonically greater than the valuations for accruals.Research limitations/implications -Overall, the results of this study suggest that inferences about the market's valuation of cash flows and accruals must consider multiple sources of variation in a concurrent fashion. Practical implications -Models for equity valuation used by financial analysts, institutional investors, etc. should allow the various components of accruals to act independently. Originality/value -This study contributes to the literature by synthesizing various aspects of capital markets research in accounting to enhance our understanding of the role that cash flows and accruals maintain for equity valuation.

This study compares the relative information content of the new specifications of operating and financing cash flow as proposed jointly by the IASB and the FASB with the specifications in SFAS No. 95. A unique feature of the study is the use of the Siegel and Biddle (1994) test of relative information content. The results indicate that the proposed operating cash flow measure has less relative information content than the current measure, and the results for financing cash flow are consistent with equity investors finding no significant difference between the current and proposed measures. Copyright (c) 2010 The Author. Accounting and Finance (c) 2010 AFAANZ.