How does depreciations management affect subsequent fiscal performance? The case of the Swiss cantons

Swiss Journal of Economics and Statistics

Table 1 Additional 'depreciation' charges, reported and true balance in real Swiss francs per capita—summary statistics per canton (1980–2012)

Canton	N	Additional 'depreciation' charges (AD)					Reported balance (B^R)				True balance (B = B^R + AD)
		F	Mean	Std. dev.	Min	Max	Mean	Std. dev.	Min	Max	Mean	Std. dev.	Min	Max
AG	19	9	4	9	0	27	83	178	− 147	439	81	805	− 3035	902
AI	34	28	168	159	0	780	50	60	− 37	192	239	194	− 79	800
AR	34	11	43	201	0	1173	1	526	− 1180	2546	51	233	− 458	827
BE	27	22	129	187	0	550	− 154	415	− 1054	300	− 117	499	− 2196	324
BL	33	27	95	198	0	941	60	231	− 263	693	191	302	− 257	822
BS	19	0	0	0	0	0	683	665	− 494	2083	384	1150	− 3151	1788
FR	18	1	14	59	0	250	251	813	− 131	3469	170	243	− 215	634
GE	28	1	63	333	0	1764	− 309	955	− 1726	1829	− 262	948	− 1719	1868
GL	34	12	74	151	0	648	41	372	− 551	1919	169	530	− 821	1912
GR	26	14	178	471	0	2438	196	559	− 794	1951	358	603	− 418	2201
JU	34	6	21	57	0	263	21	581	− 805	3144	− 147	273	− 899	246
LU	26	18	46	61	0	210	172	540	− 315	2603	126	269	− 378	686
NE	34	0	0	0	0	0	− 201	272	− 1342	90	42	241	− 655	416
NW	34	24	260	371	0	1559	49	136	− 231	510	256	355	− 239	1179
OW	28	17	154	197	0	717	161	713	− 224	3758	232	248	− 216	887
SG	17	0	0	0	0	0	127	207	− 273	659	44	300	− 504	636
SH	24	12	72	137	0	573	69	327	− 382	1343	132	270	− 411	767
SO	32	15	72	163	0	819	− 139	671	− 1910	2356	− 143	479	− 1019	793
SZ	27	27	143	102	17	373	123	460	− 929	1001	211	421	− 571	1105
TG	32	20	35	103	0	563	58	174	− 229	368	71	197	− 262	428
TI	34	5	64	207	0	901	11	442	− 965	914	20	478	− 988	1037
UR	30	18	552	635	0	2819	166	318	− 285	1131	627	631	− 304	1728
VD	34	12	42	97	0	472	− 127	399	− 796	535	− 60	458	− 871	705
VS	31	9	86	145	0	408	134	835	− 472	4504	167	356	− 416	842
ZG	34	31	286	193	0	766	463	471	− 174	1652	613	605	− 126	2370
ZH	32	5	2	6	0	16	12	390	− 1227	1079	− 10	369	− 1177	631
Overall	755	344	113	252	0	2819	61	520	− 1909	4504	129	514	− 3151	2370

Column N indicates the number of years during which each canton applied the common chart of accounts. Column F reports the absolute frequency of additional depreciation charges, i.e. the number of years at the end of which AD were recorded (thus N > F). The central panel shows the balance as it was reported by the cantons B^R, i.e. the balance marred by additional depreciation charges. The right panel shows the corrected true balance B, i.e. the balance that would have been reported if AD had not been booked. Corrections were also made to suppress operations on cookie-jar reserves and exceptional operating revenues and operating expenses. Cantons are ranked according in alphabetical order
Source: Swiss cantons’ financial statements; compilation by the authors