The highlights section in the annual report provides an opportunity for firms to emphasize specific performance measures and sets the tone for the rest of the annual report. Based on a sample of the top 200 Australian firms, we find that companies rely on non-IFRS earnings to supplement...

We analyze the trade-off between the benefits of signaling and the distortions from opportunistic earnings management resulting from the discretionary capitalization of Research amp; Development (Ramp;D) expenditures. The latter can be used by managers to signal private information to the...

This paper analyzes the capitalization of Research & Development (R&D) expenditures under IFRS. Discretionary R&D capitalization can be exercised by managers to signal private information on future economic benefits to the market. It can, however, also serve as opportunistic earnings management....

We analyze the trade-off between the benefits of signaling and the distortions fromopportunistic earnings management resulting from the discretionary capitalization ofResearch & Development (R&D) expenditures. The latter can be used by managers to signalprivate information to the market. It can...