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Full-Text Articles in Business
Accounting Flexibility And Managers' Forecast Behavior Prior To Seasoned Equity Offerings, Jae Bum Kim
Accounting Flexibility And Managers' Forecast Behavior Prior To Seasoned Equity Offerings, Jae Bum Kim
Research Collection School Of Accountancy
This study examines the effect of accounting flexibility on managers’ forecasting behavior prior to seasoned equity offerings (SEOs). Although SEO firms have a strong incentive to convey optimistic information to boost the pre-SEO stock price, they also face enhanced litigation risk arising from SEO-related regulations. Thus, I hypothesize that managers will release positive news through their forecasts (relative to the prevailing analyst consensus) prior to an SEO only if they have the accounting flexibility to manage subsequent reported earnings to meet or exceed their forecasts. I find that managers with greater accounting flexibility are more likely to issue a forecast …
Mandatory Financial Reporting And Voluntary Disclosure: The Effect Of Mandatory Ifrs Adoption On Management Forecasts, Xi Li, Holly I. Yang
Mandatory Financial Reporting And Voluntary Disclosure: The Effect Of Mandatory Ifrs Adoption On Management Forecasts, Xi Li, Holly I. Yang
Research Collection School Of Accountancy
This study examines the effect of the mandatory adoption of International Financial Reporting Standards (IFRS) on voluntary disclosure. Using a difference-in-difference analysis, we document a significant increase in the likelihood and frequency of management earnings forecasts following mandatory IFRS adoption, consistent with the notion that IFRS adoption alters firms' disclosure incentives in response to increased capital-market demand. We find the increase to be larger among firms domiciled in code-law countries, suggesting a catching-up effect among firms facing low disclosure incentives pre-adoption. We then propose and test three channels through which IFRS adoption could alter firms' disclosure incentives: improved earnings quality, …
Mandatory Financial Reporting And Voluntary Disclosure: The Effect Of Mandatory Ifrs Adoption On Management Forecasts, Xi Li, Holly I. Yang
Mandatory Financial Reporting And Voluntary Disclosure: The Effect Of Mandatory Ifrs Adoption On Management Forecasts, Xi Li, Holly I. Yang
Research Collection School Of Accountancy
This study examines the effect of the mandatory adoption of International Financial Reporting Standards (IFRS) on voluntary disclosure. Using a difference-in-difference analysis, we document a significant increase in the likelihood and frequency of management earnings forecasts following mandatory IFRS adoption, consistent with the notion that IFRS adoption alters firms' disclosure incentives in response to increased capital-market demand. We find the increase to be larger among firms domiciled in code-law countries, suggesting a catching-up effect among firms facing low disclosure incentives pre-adoption. We then propose and test three channels through which IFRS adoption could alter firms' disclosure incentives: improved earnings quality, …