Show simple item record

dc.contributor.authorHorton, Joanne
dc.contributor.authorSerafeim, Georgios
dc.contributor.authorSerafeim, Ioanna
dc.date.accessioned2012-11-09T15:32:04Z
dc.date.issued2012-11-09
dc.identifier.citationHorton, Joanne, George Serafeim, and Ioanna Serafeim. "Does Mandatory IFRS Adoption Improve the Information Environment?" Contemporary Accounting Research (forthcoming).en_US
dc.identifier.issn0823-9150en_US
dc.identifier.urihttp://nrs.harvard.edu/urn-3:HUL.InstRepos:9887632
dc.description.abstractMore than 120 countries require or permit the use of International Financial Reporting Standards (‘IFRS’) by publicly listed companies on the basis of higher information quality and accounting comparability from IFRS application. However, the empirical evidence about these presumed benefits are often conflicting and fail to separate between information quality and comparability. In this paper we examine the effect of mandatory IFRS adoption on firms’ information environment. We find that after mandatory IFRS adoption consensus forecast errors decrease for firms that mandatorily adopt IFRS relative to forecast errors of other firms. We also find decreasing forecast errors for voluntary adopters, but this effect is smaller and not robust. Moreover, we show that the magnitude of the forecast errors decrease is associated with the firm-specific differences between local GAAP and IFRS. This finding suggests that it is IFRS adoption rather than a correlated unobservable factor that is causing forecast errors to decrease. Exploiting individual analyst level data and isolating settings where analysts would benefit more from either increased comparability or higher quality information, we document that the improvement in the information environment is driven both by information and comparability effects. These results suggest that mandatory IFRS adoption has improved the quality of information intermediation in capital markets and as a result firms’ information environment by increasing both information quality and accounting comparability.en_US
dc.language.isoen_USen_US
dc.relation.hasversionhttp://papers.ssrn.com/sol3/papers.cfm?abstract_id=1264101en_US
dash.licenseOAP
dc.subjectinternational accountingen_US
dc.subjectfinancial reportingen_US
dc.subjectstandardsen_US
dc.subjectinformationen_US
dc.subjectqualityen_US
dc.subjectearnings managementen_US
dc.titleDoes Mandatory IFRS Adoption Improve the Information Environment?en_US
dc.typeJournal Articleen_US
dc.description.versionAuthor's Originalen_US
dc.relation.journalContemporary Accounting Researchen_US
dash.depositing.authorSerafeim, Georgios
dc.date.available2012-11-09T15:32:04Z
dc.identifier.doi10.1111/j.1911-3846.2012.01159.x
dash.authorsorderedfalse
dash.contributor.affiliatedSerafeim, Georgios


Files in this item

Thumbnail

This item appears in the following Collection(s)

Show simple item record