Accounting Policy Disclosures and Analysts' Forecasts
Author | : Ole-Kristian Hope |
Publisher | : |
Total Pages | : 0 |
Release | : 2003 |
ISBN-10 | : OCLC:1376870753 |
ISBN-13 | : |
Rating | : 4/5 ( Downloads) |
Download or read book Accounting Policy Disclosures and Analysts' Forecasts written by Ole-Kristian Hope and published by . This book was released on 2003 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using an international sample, I investigate whether the extent of firms' disclosure of their accounting policies in the annual report is associated with properties of analysts' earnings forecasts. Controlling for firm- and country-level variables, I find that the level of accounting policy disclosure is significantly negatively related to forecast dispersion and forecast error. In particular, I find that accounting policy disclosures are incrementally useful to analysts over and above all other annual report disclosures. These findings suggest that accounting policy disclosures reduce uncertainty about forecasted earnings. I find univariate but not multivariate support for the hypothesis that accounting policy disclosures are especially helpful to analysts in environments where firms can choose among a larger set of accounting methods.