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Volume 7, Issue No. 1, June 2000
The inaugural issue of
Asia-Pacific Journal of Accounting & Economics
(APJAE) was published in early November 2000. This first issue contains two papers and two discussant comments. Both papers were presented at the first APJAE Symposium held in Hong Kong from 3 - 4 January 2000.
Table of Contents
Foreword from Co-Editors
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Majella Percy
, Financial reporting discretion and voluntary disclosure: Corporate research and development in Australia
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Ross L Watts, Discussion of financial reporting discretion and voluntary disclosure: Corporate research and development in Australia
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Hongtao Guo and David A Ziebart
, The effects of earnings management, inside information, and voluntary disclosure choice on the accuracy of management earnings forecasts
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Charles J P Chen, Discussion of the effects of earnings management, inside information, and voluntary disclosure choice on the accuracy of management earnings forecasts
Financial reporting discretion and voluntary disclosure:
Corporate research and development in Australia
Majella Percy
Queensland University of Technology
Abstract
The aim of this paper is to explain Australian R & D capitalization and voluntary disclosure. It is argued that the discretionary choices available to management in Australia with respect to the accounting for and the disclosure of R&D expenditure and activities can be explained by the reduction of information asymmetries and agency costs. The results confirm that three aspects of information asymmetry investigated are important in explaining the discretionary capitalization of R&D expenditure: research intensity; the use of R&D financing arrangements; and the percentage of subsidiaries not wholly owned. Furthermore, research intensity, and the use of R&D financing arrangements are significant in explaining voluntary disclosure of R&D expenditure and activities. These results are robust to the inclusion of controls for other economic characteristics of the firm including share issue, size, accounting performance, leverage, proprietary costs and tax status. © City University of Hong Kong.
JEL classification: M41, M44 and M45
Keywords: agency theory; disclosure; information asymmetry; R&D; research and development
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The effects of earnings management, inside information, and voluntary disclosure choice on the accuracy of management earnings forecasts
Hongtao Guo and David A Ziebart
University of Illinois at Urbana-Champaign
Abstract
This study examines the links between management forecast accuracy and earnings management, inside information, and motives for issuing a forecast. Our results provide empirical evidence of a link between managers' private information and their forecast accuracy. In addition, we find evidence supporting the links between forecast accuracy and both self-selection to forecast and discretionary accruals. However, the evidence varies across type of forecast (good or bad news) and whether the forecast is an initial forecast or the continuance of previous forecasting behaviour. Overall, managers' forecast accuracy is linked to a combination of their inside information regarding performance, their incentive to self-select to forecast, and their ability to manage earnings. © City University of Hong Kong.
JEL classification: C53, D84, G10 and M41
Keywords: inside information; earnings management; voluntary disclosure; forecast accuracy
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