Our study attempts to determine whether, and if so why, the large auditing firms are able to earn a premium on their audit work in the UK. We start by confirming the apparent existence of a Big Firm premium during the period 1985-2002. We examine industry specialisation, non audit service fee...

We study the consequences of mandatory adoption of International Financial Reporting Standards for earnings quality. On transitioning from local GAAP to IFRS, firms can make strategic balance sheet adjustments that in turn affect future reported earnings. We predict that earnings quality after...

We examine the impact of global IFRS adoption on cross-border equity investments by individual investors. Our proxy for cross-border equity investments is trading volume in the Open Market at Frankfurt Stock Exchange. The Open Market is a segment designed for German individual investors to trade...

This paper investigates the incremental information content of three accounting performance measures for U.K. firms: earnings, funds flow and cash flow. Based on tests of association using the most general specifications suggested by the recent literature incorporating time-varying parameters...

The predictability of abnormal returns based on information contained in past earnings announcements is an anomaly that is statistically and economically significant. It is neither illusory, nor an artifact of the experimental design. It may be a result of market inefficiency. Our results cannot...

This paper investigates the incremental information content of three accounting performance measures for U.K. firms: earnings, funds flow and cash flow. Based on tests of association using the most general specifications suggested by the recent literature incorporating time-varying parameters...

Prior research using the residual income valuation model and linear information models has generally found that estimates of firm value are negatively biased. We argue that this could result from the way in which accounting conservatism effects are reflected in such models. We build on the...