The market's valuation of nonreported accounting measures: retrospective reconciliations of non-U.S. and U.S. GAAP
Article Abstract:
Income and shareholders' equity reconciliations in initial registration statements of non-US registrants were evaluated for their value relevance. Results suggest a significant correlation between market-to-book ratios in periods predating the initial SEC filing by at least three months and shareholders' equity reconciliations disclosed in the registration statement. The implication of this association is that the market can derive at least some of the value-relevant information in the SEC-mandated disclosures from other sources. However, when such association is analyzed further, no relationship is found between the reconciling items and security returns. This suggests that prior to the reconciliation's disclosure, prices contain all of the value-relevant information embodied in the reconciliation.
Publication Name: Journal of Accounting Research
Subject: Business
ISSN: 0021-8456
Year: 1997
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Voluntary semiannual earnings disclosures, earnings volativity, unexpected earnings, and firm size
Article Abstract:
No observable link can be established between disclosure of interin earnings and earnings volatility. Disclosure of interim earnings are classified as quantified when point estimates of earnings are provided in the announcement, all other cases, however, are regarded as being unquantified. Research shows that either no association is present between the amount of voluntary semiannual company earnings announcements, whether quantified or unquantified, and earnings volatility or that association is uncorrelated due to adverse effects. More nonquantified disclosure emanate from organizations with large disclosure errors, while quantified interim disclosures are not limited by the type of earnings news disclosed. Furthermore, the size of the firm does not influence the level of disclosure.
Publication Name: Journal of Accounting Research
Subject: Business
ISSN: 0021-8456
Year: 1992
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