IFRS Adoption and Stock Prices of Japanese Firms in Governance System Transition |
| |
Authors: | Shun Sato Fumiko Takeda |
| |
Institution: | Department of Technology Management for Innovation, University of Tokyo, 7-3-1 Hongo, Bunkyo-ku, Tokyo 113-8656, Japan |
| |
Abstract: | This study examines firms' decision to voluntarily adopt IFRS in a setting where there are changes to the governance system in a traditionally code law country, as well as how the market responds to such decisions. We find the probability of voluntary IFRS adoption to be higher among firms that have a high proportion of foreign shareholders, undertake quality audits, have low levels of leverage, feature a nominating committee, and are included in the new market index. In addition, the stock prices of IFRS adopters tend to increase around the announcement date of IFRS adoption, compared to those of non-adopters. Finally, market reactions are smaller for firms that feature a nominating committee, and are included in the new market index—perhaps because IFRS adoption by these firms is less surprising to market participants, and because IFRS adoption is not expected to add large incremental value to these firms. |
| |
Keywords: | International financial reporting standards Voluntary adoption Stock price Firm characteristic Market reaction |
本文献已被 ScienceDirect 等数据库收录! |
|