Earnings forecast accuracy and geographic segment disclosures

Nichols, Dave; Tunnell, Larry; Seipel, Cindy L.

doi:10.1016/1061-9518(95)90012-8

Cited by 18 publications

(7 citation statements)

References 7 publications

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“…More generally, our findings are consistent with prior research that links disclosure quality with the ability of analysts and investors to predict firm performance, both with respect to overall disclosure quality (e.g., Lang and Lundholm, 1996;Lundholm and Myers, 2002;and Gelb and Zarowin, 2002) and with respect to geographic segment disclosures (e.g., Kinney, 1971;Tse, 1989;Balakrishnan et al, 1990;Nichols et al, 1995;Herrmann, 1996;andHope et al, 2007 and. Our documented increase in the size of the coefficient on foreign earnings is likely attributable to a combination of three factors.…”

Section: (Iii) Tests Of Hsupporting

confidence: 89%

“…Regarding geographic segment disclosures, prior research suggests that, under certain conditions, such disclosures potentially enhance predictability of consolidated amounts (e.g., Balakrishnan et al, 1990;Nichols et al, 1995;Herrmann, 1996;and Lobo et al, 1998). However, user groups complained that firms' disclosure practices under SFAS 14 were inadequate and research has shown that investors did not use SFAS 14 geographic segment earnings disclosure in valuing securities (Boatsman et al, 1993).…”

Section: (Ii) Hypothesesmentioning

confidence: 94%

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Pricing and Mispricing Effects of SFAS 131

Hope

Kang

Thomas

et al. 2008

Business Fin & Account

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We investigate the effects of the introduction of Statement of Financial Accounting Standards No. 131 (SFAS 131) on the market's valuation of foreign earnings. Thomas (1999) documents that investors discount the value of foreign earnings for US multinational companies. He conjectures but does not test the possibility that this finding is due to poor disclosure related to foreign operations. We find strong evidence that the introduction of the standard is positively associated with the pricing of foreign earnings. In addition, we use both the Mishkin (1983) test and a zero-investment hedge portfolio test and find that investors' mispricing of foreign earnings lessens (and in fact disappears) after SFAS 131. This study is one of the first attempts to show that improved disclosure reduces mispricing. Copyright (c) 2008 The Authors Journal compilation (c) 2008 Blackwell Publishing Ltd.

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Section: (Iii) Tests Of Hsupporting

confidence: 89%

Section: (Ii) Hypothesesmentioning

confidence: 94%

Pricing and Mispricing Effects of SFAS 131

Hope

Kang

Thomas

et al. 2008

Business Fin & Account

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“…Some disclosure studies (e.g. Nichols et al , 1995; Collett, 2004) used a control group to control for selected variables not of interest to the researcher, though there are problems associated with the use of control groups, such as sample selection bias (Mosley, 1998). A potential control group for the present study would be a sample drawn from conventional banks based in Islamic countries.…”

Section: Empirical Investigationmentioning

confidence: 99%

Social reporting by islamic banks

Maali

Casson

Napier

2006

Abacus

427

566

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The last thirty years have witnessed the appearance and rapid expansion of Islamic banking both inside and outside the Islamic world. Islamic banks provide financial products that do not violate Sharia , the Islamic law of human conduct. The Islamic principles upon which the banks claim to operate give an important role to social issues. Applying these principles, we develop a benchmark set of social disclosures appropriate to Islamic banks. These are then compared, using a disclosure index approach, the actual social disclosures contained in the annual reports of twenty-nine Islamic banks (located in sixteen countries) to this benchmark. In addition, content analysis is undertaken to measure the volume of social disclosures. Our analysis suggests that social reporting by Islamic banks falls significantly short of our expectations. The results of the analysis also suggest that banks required to pay the Islamic religious tax Zakah provide more social disclosures than banks not subject to Zakah .

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“…Similarly, Balakrishnan, Harris, and Sen (1990) fiid that geographic earnings can improve the predictability of consolidated earnings under certain conditions. Nichols, Tunnell, and Seipel (1995) report that the earnings forecast accuracy of financial analysts improved after implementation of SFAS 14.…”

Section: Prior Research Relating Geographic Segment Disclosures To Eamentioning

confidence: 99%