This study examines the predictive power of comprehensive income and its individual components within the homogenous institutional setting of German IFRS firms. The results could be relevant for the standard setters IASB and FASB and their joint project “Financial Statement Presentation”. We...

This paper examines how the characteristics of accounting systems and management incentives interact and collectively determine financial reporting quality. We develop a rational expectations equilibrium model that features a steady-state firm with investments, financial and non-financial...

I find that goodwill write-offs under Statement of Financial Accounting Standards No. 142 (SFAS 142) are associated with future expected cash flows as mandated by the standard. However, there are indications that goodwill write-offs lag behind the economic impairment of goodwill. Additional...

This paper analyses accounting accruals that may relate to earnings quality and its information content. The characteristics specifying earning quality are discussed according to research surveys of earnings quality. These are compared with the characteristics of accounting income specified by...

A premise of standard setters and of much empirical research is that improving the quality of accounting standards and their implementation increases information in capital markets. This paper challenges this premise and shows that there are situations in which “better”, i.e., more...

The corporate information environment develops endogenously as a consequence of information asymmetries and agency problems between investors, entrepreneurs, and managers. We provide a framework for analyzing the three main decisions that shape the corporate information environment in a capital...

In an experiment with 127 accounting professionals averaging over 18 years of experience, we investigate how two important characteristics related to auditing—prior audit negotiation outcomes and auditor expertise—affect (1) whether, on balance, the presence of an audit is more likely to...

We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics...

IFRS 7 and 9 have requirement, for recognition, measurement and disclosure of derivatives. Derivatives include futures and options for hedging foreign currency risks, interest rate risk, price risk etc. Derivatives include financial and commodity derivatives, commodity derivatives are of recent...

We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics...