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Risk disclosure noncompliance
Institution:1. Trier University, Universitätsring 15, 54296 Trier, Germany;2. Lancaster University Management School, Bailrigg, Lancaster LA1 4YX, United Kingdom;3. Erasmus School of Economics, Burgemeester Oudlaan 50, 3062 PA Rotterdam, the Netherlands;1. The Robert J. Manning School of Business, University of Massachusetts Lowell, One University Avenue, Lowell, MA 01854, USA;2. College of Business and Economics, California State University, Los Angeles, 5151 State University Drive, Los Angeles, CA 90032, USA;1. Business School, Beijing Normal University, China;2. Business School, University of International Business and Economics, China;3. School of Accounting, Zhongnan University of Economics and Law, China;4. Gordon Ford College of Business, Western Kentucky University, United States;1. Colorado State University, United States;2. Drexel University, United States;1. C. T. Bauer College of Business – University of Houston, United States;2. Kogod School of Business, American University, United States;3. Rutgers Business School, United States;1. University of Udine, Department of Economics and Statistics, Via Tomadini 30, 33100 Udine, Italy;2. University of Bologna, Department of Management, University of Bologna, via Capo di Lucca 34, 40126 Bologna, Italy
Abstract:We examine companies’ compliance with IFRS risk disclosure rules for the first fiscal year following 2007. For a sample of 383 firms from 20 European countries, we find that average risk disclosure compliance is only 62 percent. Countries’ enforcement strength is generally positively associated with risk disclosure compliance and even more effective in the presence of outsider monitoring. We highlight that cross-country differences in enforcement must be properly accounted for to ensure consistent risk disclosure compliance.
Keywords:Risk disclosure  Enforcement  Noncompliance
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