The association between stock returns and foreign GAAP earnings versus earnings adjusted to US GAAP

• 成果类型: Article
• 署名作者: Chan, KC; Seow, GS
• 署名单位: University of Connecticut
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/0165-4101(95)00405-X
• 发表日期: 1996
• 关键词: UNITED-STATES; model-specification; tests; performance; DISCLOSURES; MARKETS

摘要

This study examines the association between stock returns and foreign GAAP earnings versus earnings adjusted to U.S. GAAP. Using a sample of foreign firms with common stock or American Depositary Receipt (ADR) traded in U.S. exchanges, we compare the returns-earnings relations between U.S. and foreign GAAP-based earnings. Results based on the J(A) test indicate that earnings based on foreign GAAP are more closely associated with contemporaneous stock returns than earnings reconciled to U.S. GAAP. We find evidence that our results may be driven by institutional factors which are specific to foreign markets.