{"title":"Financial statement comparability and the usefulness of earnings: Some Canadian evidence","authors":"Shadi Farshadfar, Laleh Samarbakhsh, Yige Jiang","doi":"10.1016/j.intaccaudtax.2023.100560","DOIUrl":null,"url":null,"abstract":"<div><p>In this study, we investigate whether financial statement comparability enhances the usefulness of earnings, specifically their relevance and faithful representation, as asserted in the International Accounting Standards Board (IASB)’s conceptual framework. Thus far, researchers have documented various capital market benefits of comparability. However, the role of comparability in improving the usefulness of earnings has not yet been directly examined. Our study is motivated to address this question using data from Canadian firms in the post-International Financial Reporting Standards (IFRS) adoption period. The findings are consistent with our prediction and support the IASB’s claim, indicating that comparability enhances the decision-usefulness of earnings. These results are robust to several control factors, including industry membership, firm profitability, firm size, and leverage.</p></div>","PeriodicalId":53221,"journal":{"name":"Journal of International Accounting Auditing and Taxation","volume":null,"pages":null},"PeriodicalIF":3.3000,"publicationDate":"2023-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of International Accounting Auditing and Taxation","FirstCategoryId":"1085","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1061951823000393","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 0
Abstract
In this study, we investigate whether financial statement comparability enhances the usefulness of earnings, specifically their relevance and faithful representation, as asserted in the International Accounting Standards Board (IASB)’s conceptual framework. Thus far, researchers have documented various capital market benefits of comparability. However, the role of comparability in improving the usefulness of earnings has not yet been directly examined. Our study is motivated to address this question using data from Canadian firms in the post-International Financial Reporting Standards (IFRS) adoption period. The findings are consistent with our prediction and support the IASB’s claim, indicating that comparability enhances the decision-usefulness of earnings. These results are robust to several control factors, including industry membership, firm profitability, firm size, and leverage.
期刊介绍：
The Journal of International Accounting, Auditing and Taxation publishes articles which deal with most areas of international accounting including auditing, taxation and management accounting. The journal''s goal is to bridge the gap between academic researchers and practitioners by publishing papers that are relevant to the development of the field of accounting. Submissions are expected to make a contribution to the accounting literature, including as appropriate the international accounting literature typically found in JIAAT and other primary US-based international accounting journals as well as in leading European accounting journals. Applied research findings, critiques of current accounting practices and the measurement of their effects on business decisions, general purpose solutions to problems through models, and essays on world affairs which affect accounting practice are all within the scope of the journal.
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