The effects of SFAS 131 geographic segment disclosures by US multinational companies on the valuation of foreign earnings

• 成果类型: Article
• 署名作者: Hope, Ole-Kristian; Kang, Tony; Thomas, Wayne B.; Vasvari, Florin
• 署名单位: University of Oklahoma System; University of Oklahoma - Norman; University of Toronto; State University System of Florida; Florida Atlantic University; University of London; London Business School
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/jibs.2008.72
• 发表日期: 2009
• 页码: 421-443
• 关键词: foreign earnings; SFAS 131; geographic segment disclosures; valuation

摘要

Foreign operations are becoming increasingly important for US companies. We investigate whether the market's valuation of foreign earnings is a function of the firm's geographic segment disclosures. Specifically, we examine the effects of an increase in the number of geographic segments disclosed and the inclusion of earnings measures in geographic segment disclosures following the adoption of SFAS 131. We find strong evidence that our proxies for increased disclosure are positively associated with the valuation of foreign earnings. Our results are robust to a number of sensitivity analyses. Taken together, our results suggest that the pricing of foreign earnings is associated with important aspects of the firm's information environment.