We examine the effect of the adoption of the new revenue recognition standard (ASC 606) on earnings quality and the role of earnings in the debt market. We find that ASC 606, a transition from a rules-based to a principles-based accounting standard, decreases earnings predictability, which is...

Since the formation of the International Accounting Standards Board (IASB), the use of International Financial Reporting Standards (IFRS) has spread and they have become global standards for financial reporting. However, they are not used unanimously all over the world. This paper focuses on...

We analyse in detail conservative accounting practices in seventeen European countries, taking into account institutional factors. In addition, we examine the impact of IFRS adoption and the influence of changes in economic conditions on conditional conservatism. Specifically, we study the level...

This study examines the incremental information in loss firms' non-GAAP earnings disclosures relative to GAAP earnings. Using a large sample obtained through textual analysis and hand-collection, we posit and find that loss firms' non-GAAP earnings exclusions offset the low informativeness of...

This paper examines the changes in earnings quality of registered ADRs as a result of switching accounting standards. We aim to shed light on the potential impact of IFRS adoption on US firms. A suboptimal approach to achieve this goal is through examination of US firms' surrogates such as ADRs....

We investigate whether non-GAAP earnings disclosures increase stock price crash risk. Consistent with the notion that non-GAAP reporting allows managers to downplay reported bad news in GAAP earnings and re-direct investors' attention to the more positive aspects of performance, our empirical...

This study investigates whether market participants perceive pro forma earnings to be more informative and more persistent than GAAP operating income by analyzing a sample of 1,149 actual pro forma press releases. We find that pro forma announcers report frequent GAAP losses and are mostly...

This study analyzes the effect of the investment opportunity set (IOS) on management's use of discretionary accruals to increase or decrease income. We argue that the relation between the IOS and the managerial decision to select accounting methods to maximize or minimize reported results is...

Aim/purpose - This paper aims at investigating whether the International Financial Reporting Standard (IFRS) 15 Revenue from Contracts with Customers implementation in Poland has affected earnings management that uses discretion in revenue recognition to avoid losses and earnings decreases....

We examine the impact of SFAS 133, Accounting for Derivative Instruments and Hedging Activities, on the reporting behavior of commercial banks and the informativeness of their financial statements. We argue that, because mandatory recognition of hedge ineffectiveness under SFAS 133 reduced...