The market reaction to the reserve-based value replacement measures of oil and gas producers
Article Abstract:
The information content of supplemental reserve disclosure as required in Statement of Financial Accounting Standards No. 69: Disclosures About O and G Producing Activities is investigated. The explanatory power of three reserve-based value measures are analyzed. Results show that the net annual change in reserve value is not linked to unexpected security returns during the release week of the annual report of oil and gas producers. Market participants are also found to react positively to companies that replace their reserve base through discoveries.
Publication Name: Journal of Business Finance and Accounting
Subject: Business
ISSN: 0306-686X
Year: 1996
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Revisiting the conditions for fully revealing disclosure
Article Abstract:
A study on the conditions required for the application of the fully revealing income disclosure model is evaluated. It is argued that an invertibility condition is essential to convey information using cash flows and income reports amidst restrictions in income calculation. It is also shown that underlying information can be revealed when a one-to-one relationship exists between the continuing expected value calculation and underlying information.
Publication Name: Journal of Business Finance and Accounting
Subject: Business
ISSN: 0306-686X
Year: 1996
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Additional thoughts on conditions for fully revealing disclosure
Article Abstract:
The fully revealing income disclosure model (FRIDM) is analyzed. The application of the FRISM requires compliance with two conditions, namely, the invertibility condition of Demski and Sappington (1990) and the differences/transparency conditions of Vickerey (1992). However, it is argued that compliance with the invertibility condition is unnecessary for fully revealing disclosure.
Publication Name: Journal of Business Finance and Accounting
Subject: Business
ISSN: 0306-686X
Year: 1996
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