Adopting a Label: Heterogeneity in the Economic Consequences Around IAS/IFRS Adoptions

• 成果类型: Article
• 署名作者: Daske, Holger; Hail, Luzi; Leuz, Christian; Verdi, Rodrigo
• 署名单位: University of Mannheim; University of Pennsylvania; University of Chicago; National Bureau of Economic Research; Massachusetts Institute of Technology (MIT)
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/1475-679X.12005
• 发表日期: 2013
• 页码: 495-547
• 关键词: MANDATORY IFRS ADOPTION; earnings management; voluntary adoption; us-gaap; INFORMATION; cost; analysts; disclosure; determinants; STANDARDS

摘要

This study examines liquidity and cost of capital effects around voluntary and mandatory IAS/IFRS adoptions. In contrast to prior work, we focus on the firm-level heterogeneity in the economic consequences, recognizing that firms have considerable discretion in how they implement the new standards. Some firms may make very few changes and adopt IAS/IFRS more in name, while for others the change in standards could be part of a strategy to increase their commitment to transparency. To test these predictions, we classify firms into label and serious adopters using firm-level changes in reporting incentives, actual reporting behavior, and the external reporting environment around the switch to IAS/IFRS. We analyze whether capital-market effects are different across serious and label firms. While on average liquidity and cost of capital often do not change around voluntary IAS/IFRS adoptions, we find considerable heterogeneity: Serious adoptions are associated with an increase in liquidity and a decline in cost of capital, whereas label adoptions are not. We obtain similar results when classifying firms around mandatory IFRS adoption. Our findings imply that we have to exercise caution when interpreting capital-market effects around IAS/IFRS adoption as they also reflect changes in reporting incentives or in firms' broader reporting strategies, and not just the standards.