The Use of Foreign Accounting Data in UK Financial Institutions |
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Authors: | Samantha Miles & Christopher Nobes |
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Institution: | University of Bristol,;Coopers and Lybrand Professor of Accounting, Department of Economics, Faculty of Letters &Social Sciences, The University of Reading, Reading |
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Abstract: | Globalisation of securities markets has caused many members of the investment community to use foreign accounting data. This paper examines how this foreign data is used by some London-based participants in the market. Areas for examination are established after looking at the extensive published research on the use of domestic accounting data and the small amount of published research in an international context. Twenty-one market participants were interviewed, although four of these were treated as a pilot, so that most findings were based on 17 interviewees working for six institutions. If this sample is representative, our findings suggest that market participants are inexpert in accounting; sector experts see international accounting differences as a hindrance but country experts do not; participants use foreign accounting data for analysis but very few adjust it (although fund managers think that analysts do); there is some avoidance of countries or sectors for accounting reasons; and there is very little knowledge of international accounting differences. |
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Keywords: | international accounting analysts reconciliation of earnings |
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