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- Title
The Predictive-Ability Criterion: Its Relevance in Evaluating Accounting Data.
- Authors
Greenball, M. N.
- Abstract
This article discusses on the relevance of the predictive-ability criterion in evaluating accounting data. The study is concerned only with the validity criterion. In particular, the investigation focuses on one difficult question: how is the validity of a particular accounting method to be assessed? One specific source of difficulty lies in the fact that researchers cannot agree upon a precise definition of the property, such as earnings, which the method is supposed to measure. To the extent that accounting numbers are used for feedback and other nonpredictive purposes, the predictive-ability criterion has no relevance.
- Subjects
CRITERION (Theory of knowledge); ACCOUNTING; DECISION making; TEST validity; ACCOUNTING methods; MEASUREMENT-model comparison
- Publication
Abacus, 1971, Vol 7, Issue 1, p1
- ISSN
0001-3072
- Publication type
Article
- DOI
10.1111/j.1467-6281.1971.tb00390.x