Purpose The purpose of this study is to examine how the accounting expertise of audit committee members is associated with the disclosure of forward-looking information. Design/methodology/approach Manual content analysis is used to analyze forward-looking information disclosed in annual reports as well as gather data about the accounting expertise of directors. Regression analysis is performed to study the association between the disclosure variables and the accounting expertise of audit committee members. Findings The results show that the accounting expertise of audit committee members is associated with forward-looking disclosure practices, particularly with information of a financial and strategic nature. Practical implications The evidence has direct implications for companies in the selection of directors, as stakeholders may demand nomination committees to appoint audit committees with the accounting experts. They may also request regulatory actions regarding the structure of the audit committee, as these add to the evidence on the benefits of selecting such experts. Social implications The evidence on the role of accounting expertise could also help the US Securities and Exchange Commission (SEC) to narrow the definition of financial expertise to specifically consider accounting expertise, as is already happening in the EU context. Originality/value This paper extends prior research on corporate governance and voluntary disclosure by showing the association between the company having at least one accounting expert in the audit committee and the level of disclosure of value-relevant information.

In this paper we investigate the value-relevance of consolidated versus parent company accounting information. In particular we investigate the value relevance of the minority interest components of net total assets and earnings as currently reported and under the full entity approach to consolidated reporting. An Edwards-Bell-Ohlson valuation framework is used to generate results. By this means we cast light on the suitability of accounting regulation being developed based upon the entity or parent company theories of consolidation. We carry out the analysis in the Spanish context and the sample contains 474 observations of non-financial firms quoted in the Madrid Stock Exchange for the period 1991-97. The results from this analysis not only have domestic relevance but provide guidance of a more international nature relating to the impact of group definition, concepts of control and the most value relevant method of consolidated disclosure. The results show that, from a valuation perspective, consolidated information dominates non-consolidated, or parent company, information. However, neither the currently reported minority interest components of net total assets and earnings, nor their values under the full equity method of consolidation, are found to be value relevant. These results raise the question of whether group definitions based on the equity theory of consolidation are the most useful to investors.

Purpose The purpose of this paper is to test the association between board of director characteristics and corporate reputation. Design/methodology/approach Logistic and multivariate regressions are performed to analyse whether the board of director characteristics are associated with the level of corporate reputation. The sample is composed of listed companies in the Madrid Stock Exchange (Índice General de la Bolsa de Madrid) at least once during the period 2004-2010. Corporate governance data were manually extracted from governance reports released by Spanish companies. The data for the design of a corporate reputation measure were obtained from the Monitor Español de Reputación Corporativa (MERCO) institute web site. Findings Results from the empirical analysis show that Spanish companies that appear high up in terms of ranking in the reputation index provided by MERCO tend to have a higher percentage of independent directors as well as more female directors on their board. Firm size and the image of the president of a firm are also linked to corporate reputation. Originality/value The results have direct implications for the management of corporate governance mechanisms by shareholders who should take into account their role in the creation and maintenance of corporate reputation.

No abstract

Theories have been developed in the disclosure literature to explain the reasons behind the decision to disclose more information. Empirical evidence does not consistently support disclosure theories and results found are contradictory. The diffi culty in measuring voluntary disclosure might be one of the reasons infl uencing on these divergences. In this paper, we investigate two key questions related to disclosure measurement. First, we aim to empirically test if use of disclosure indices that measure different information attributes determines validity of disclosure theories. Second, we investigate how disclosure indices design infl uences results. Results show that determinants of more specifi c information attributes are different than those that infl uence less specifi c attributes. Furthermore, independently of the information attribute that is measured, disclosure measure design infl uences results.KEY WORDS Disclosure indices; Disclosure determinants; Forward-looking information; Disclosure theories.RESUMEN En la literatura sobre divulgación de información se han desarrollado diversas teorías para explicar los motivos que llevan a las empresas a divulgar más información. La evidencia empírica no apoya consistentemente las teorías y los resultados encontrados son contradictorios. Estas divergencias podrían estar ocasionadas por problemas implícitos a la medición de la información voluntaria. En este trabajo, se estudian dos cuestiones clave relacionadas con este problema. Primeramente, investigamos si el uso de índices de revelación que captan diferentes atributos informativos determina la validez de las teorías enunciadas sobre la divulgación de información. Por otro lado, analizamos la infl uencia de utilizar distintas medidas de la información. Los resultados muestran que los determinantes de atributos informativos más específi cos son distintos de aquellos factores que infl uyen en la divulgación de atributos menos específi cos. Además, independientemente del atributo informativo que es medido, el diseño de un índice de revelación infl uye en los resultados obtenidos. PALABRAS CLAVE Divulgación de información; Determinantes de la divulgación; Información previsional; Teorías sobre divulgación.

Fundamental analysis of stocks links financial data to firm value in two consecutive steps: a predictive information link tying current financial data to future earnings, and a valuation link tying future earnings to firm value. At each step, a large number of causal factors have to be factored into the evaluation. To effect these calculations, we propose a new two-stage multi-criteria procedure, drawing on the techniques of data envelopment analysis. At each stage, a piecewise linear efficiency frontier is fitted to the observed data. The procedure is illustrated by a numerical example, analyzing some 30 stocks in the Spanish manufacturing industry in the years 1991-1996. Copyright © 2004 John Wiley & Sons, Ltd.

Theoretically, companies disclosing more voluntary information will benefit from a lower cost of capital, although empirical research provides inconclusive results. Our study aims to analyze the influence of the disclosure of forward‐looking information on the cost of capital, because this information is extremely useful for investors. Results show that only specific information on actions, programs, decisions, and/or quantitative financial information helps toward the reduction of cost of capital. This evidence has direct economic implications, because it enables regulators and managers to focus on those disclosure strategies that are effective in the reduction of cost of capital. Copyright © 2012 John Wiley & Sons, Ltd.

This paper summarises the contents of a comment letter produced by a working group of 12 academics in response to the International Accounting Standards Board (IASB) Discussion Paper on principles of disclosure. The comment letter was submitted by the Financial Reporting Standards Committee (FRSC) of the European Accounting Association (EAA). The work includes reviews of relevant academic literature of areas related to the various questions posed by the IASB in the Discussion Paper, including the 'disclosure problem' and the objective of the project, the suggested principles of effective communication, the roles of the primary financial statements and notes, the location of information and the use of performance measures. The paper also discusses the disclosure of accounting policies, the objectives of centralised disclosure, and the New Zealand Accounting Standards Board staff's approach to disclosure.