Does Multistandard Reporting Affect Analysts' Forecasts?

Ye, Yang; Henry, Elaine

doi:10.1002/jcaf.21830

Cited by 1 publication

(1 citation statement)

References 23 publications

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“…Our article is directly related to prior studies exploring the consequences of the SEC's rule to eliminate the 20-F reconciliation requirement for IFRS firms (Byard et al, 2010;Chen, Deng, et al, 2015;Chen & Khurana, 2015;Hansen et al, 2010;Kang et al, 2012;Kim et al, 2012;Lin & Huang, 2014;Yang & Henry, 2013;Yu, 2011). Although these studies focus on its impact on various aspects such as information environment, earnings attributes, voluntary disclosure, and shareholder wealth, we focus exclusively on its impact on financial analysts.…”

Section: Introductionmentioning

confidence: 95%

Analyst Following and Forecast Accuracy After Eliminating the 20-F Reconciliation Between IFRS and U.S. GAAP

Zhang

2020

Journal of Accounting, Auditing & Finance

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In 2007, the U.S. Securities and Exchange Commission (SEC) decided to allow foreign private issuers to file financial statements prepared according to International Financial Reporting Standards (IFRS) without reconciliation to U.S. Generally Accepted Accounting Principles (GAAP). Using a sample of foreign private issuers from 35 countries/regions during the period of 2005 to 2008, this article investigates how the elimination of the 20-F reconciliation affects financial analysts. We find that it significantly reduces analyst coverage but has no impact on forecast accuracy. We show that analysts who are greatly affected are more likely to terminate their coverage of IFRS firms after the SEC’s rule than other analysts. In addition, we hypothesize and find that eliminating the 20-F reconciliation has a greater impact on firms whose 20-F reconciliation is more useful to analysts. For these firms, the elimination of the 20-F reconciliation significantly reduces both analyst coverage and forecast accuracy. Overall, our results suggest that the elimination of the 20-F reconciliation imposes costs on financial analysts.

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Section: Introductionmentioning

confidence: 95%

Analyst Following and Forecast Accuracy After Eliminating the 20-F Reconciliation Between IFRS and U.S. GAAP

Zhang

2020

Journal of Accounting, Auditing & Finance

View full text Add to dashboard Cite

show abstract

Does Multistandard Reporting Affect Analysts' Forecasts?

Cited by 1 publication

References 23 publications

Analyst Following and Forecast Accuracy After Eliminating the 20-F Reconciliation Between IFRS and U.S. GAAP

Analyst Following and Forecast Accuracy After Eliminating the 20-F Reconciliation Between IFRS and U.S. GAAP

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