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Measuring Financial Statement Disaggregation Using Xbrl, Joseph A. Johnston, Kenneth J. Reichelt, Pradeep Sapkota
Measuring Financial Statement Disaggregation Using Xbrl, Joseph A. Johnston, Kenneth J. Reichelt, Pradeep Sapkota
Faculty Publications - Accounting
We develop a measure of disclosure quality using disaggregation of financial statement items from the Form 10-K XBRL filing. Our measure (ITEMS) extends Chen, Miao, and Shevlin’s (2015),DQ measure and is distinct from R. Hoitash and U. Hoitash’s (2018) ARC measure. Our measure provides a simple measure of disaggregation by counting the balance sheet and income statement line items, it does not depend on the data aggregators’ collection process and is readily available shortly after the Form 10-K is filed. We validate ITEMS by showing that firm fundamentals correlate to ITEMS in the predicted direction using …