Accounting Standards Harmonization and Financial Statement Comparability: Evidence from Transnational Information Transfer

• 成果类型: Article
• 署名作者: Wang, Clare
• 署名单位: Northwestern University
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/1475-679X.12055
• 发表日期: 2014
• 页码: 955-992
• 关键词: ANNUAL EARNINGS ANNOUNCEMENTS; mandatory ifrs adoption; PREDISCLOSURE INFORMATION; firm capitalization; Investor protection; UNEXPECTED EARNINGS; PRICE BEHAVIOR; management; incentives; forecasts

摘要

This paper investigates whether accounting standards harmonization enhances the comparability of financial information across countries. I hypothesize that a firm yet to announce earnings reacts more strongly to the earnings announcement of a foreign firm when both report under the same rather than different accounting standards. My analysis of abnormal price reactions for a global sample of firms supports the prediction. Next, in an attempt to control for the underlying economic comparability and the effects of changes in reporting quality, I use a difference-in-differences design around the mandatory introduction of International Financial Reporting Standards. I find that mandatory adopters experience a significant increase in market reactions to the release of earnings by voluntary adopters compared to the period preceding mandatory adoption. This increase is not observed for non-adopters. Taken together, the results show that accounting standards harmonization facilitates transnational information transfer and suggest financial statement comparability as a direct mechanism.