Narrow Results

Effective information disclosure is the cornerstone of sustainable operation of the capital market. In the IPO market, whether public information in the prospectus can be fully captured by investors largely depends on the quality of valuation-relevant information. Based on Chinese prospectuses, we create five unique indicators to measure the information quality and examine the relationship between information quality and IPO underpricing. We find that high quality of information disclosure results in less underpricing because they relieve serious information asymmetry between issuing companies and investors. We provide a new method to supervise and improve the quality of non-financial information disclosure.

As more and more organizations collect, store, and release large amounts of personal information, it is increasingly important for the organizations to conduct privacy risk assessment so as to comply with various emerging privacy laws and meet information providers' demands. Existing statistical database security and inference control solutions may not be appropriate for protecting privacy in many new uses of data as these methods tend to be either less or over-restrictive in disclosure limitation or are prohibitively complex in practice. We address a fundamental question in privacy risk assessment which asks: how to accurately derive bounds for protected information from inaccurate released information or, more particularly, from bounds of released information. We give an explicit formula for calculating such bounds from bounds, which we call square bounds or S-bounds. Classic F-bounds in statistics become a special case of S-bounds when all released bounds retrograde to exact values. We propose a recursive algorithm to extend our S-bounds results from two dimensions to high dimensions. To assess privacy risk for a protected database of personal information given some bounds of released information, we define typical privacy disclosure measures. For each type of disclosure, we investigate the distribution patterns of privacy breaches as well as effective and efficient controls that can be used to eliminate privacy risk, both based on our S-bounds results.

Government agencies and other organizations commonly release or share microdata for purposes of analysis. In many cases, microdata release needs to preserve the privacy of individuals and/or sensitive attributes. Current measures of privacy of released microdata are often based on empirical assessments of identity and value disclosure. The disadvantage of empirical assessments of privacy is that their results cannot be generalized with confidence across datasets or protection methods. While theoretical definitions of privacy are available for other methods of data release such as query-response output perturbation systems, they are unsuitable for the microdata release context. This study proposes a theoretical basis for measuring privacy in the microdata release context based on statistical dependence. Using this theoretical basis, we develop practical privacy measures that possess several desirable properties, including generalizability. We illustrate the conceptual benefits of this approach and also show that a privacy measure based on statistical dependence can be used effectively for assessing privacy in microdata

We set up a model to study the voluntary disclosure of information by insiders of publicly traded companies. We consider a trading framework as in [14] with many assets and one insider per asset. There is one discretionary liquidity trader who can allocate his trades across the different assets and many noise traders who trade with equal intensity in all assets. Before trade begins, insiders can disclose information in order to attract the discretionary liquidity trades. We show that if the level of noise trading is above a certain threshold, then there is an equilibrium where all insiders do not disclose any information. Below this threshold, equilibria are such that some information is always revealed by insiders. We also find that the greater the number of assets, the smaller the intensity of noise trading must be in order to induce insiders to disclose some information, and we find that insiders reveal all their information when the intensity of noise trading approaches zero.

Corporate Chief Financial Officers (CFOs) in many countries at different levels of development and in various parts of the world considered financial statement disclosure and corporate corruption to be serious corporate problems long before the Enron debacle. This paper presents the results of a survey of CFOs conducted across 40 countries during the fall of 2000 and the spring of 2001. Most of the respondents, including those in the United States, considered the lack of adequate disclosure of information by companies to be a bigger issue than either corrupt business practices or a lack of effective accounting guidelines. Only in the United Kingdom did more CFOs consider the lack of effective accounting guidelines to be an issue of more concern than the lack of disclosure.

When examining Form 8-K filings under the Securities and Exchange Commissions' (SEC) Rule 10b-5, Carter and Soo (1999) found that over 26% are filed after the statutory due date. "Bad news" filings resulted in over 30% tardiness. Effective August 23, 2004, the SEC passed the Additional Form 8-K Disclosure and Acceleration of Filing Date Rule (henceforth, the 2004 Current Report Rule), which expanded the number of disclosures required to be submitted on the Form 8-K, while decreasing the reporting deadline from 15 calendar days (for most events) to only four business days after event occurrence. Consequently, the purpose of this paper is to assess the immediate compliance behavior of firms, consequent to the passage of the 2004 Current Report Rule (CRR).

In order to examine immediate effects, our sample consists of 2004 fourth quarter Form 8-K filings. Results indicate that compliance with stated Form 8-K deadlines has significantly improved. Relative to the other events examined, Form 8-K filings are more likely to be late if they report director resignations (i.e. "bad news"). Other results indicate no discernable differences between the number of days to file within the four day requirement and no industry is more likely than another to be noncompliant. In sum, this paper's findings should be of interest to the SEC, because they support the SEC's policy (i.e. the 2004 CRR) of firms providing material information to investors in a more timely fashion.

In deciding how much customer information to disclose, managers face a tradeoff between the benefits of reducing information asymmetry and the losses of revealing proprietary information. This paper investigates which factors affect the level of ambiguous customer identity disclosure and whether such ambiguous disclosure affects the cost of equity capital. The empirical evidence shows that the proprietary cost is a crucial factor in ambiguous customer identity disclosure. Firms with a higher level of ambiguous customer identity disclosure generate a higher cost of equity capital. Moreover, the higher cost of equity capital is concentrated among firms under imperfect market competition.

The main aim of this study is to demonstrate how important it is for Spanish public universities to provide information on their intellectual capital in order to satisfy their users' information needs. To this end, we analysed the opinion held by the members of the Social Councils regarding the need for Spanish public universities to publish information on their intellectual capital when presenting economic, financial and budgetary information. The results of this research show extensive criticism of the current accounting information model used by public universities in Spain. They also demonstrate a widespread interest in universities including information on their intellectual capital with a view to increasing the relevance of the current university financial statements.

Preparing for the imminent arrival of International Financial Reporting Standards (IFRS) is proving to be challenging for many European companies for which IFRS takes effect in 2005. Not least among these challenges are that reporting requirements are substantial and time to prepare is running short. Transition to the new standards will bring further demands as market participants familiarize themselves with the revised financial reporting. Specifically, companies will need to pay particular attention to how they communicate their financial restatements. If market participants are not provided with clear information, the capital markets could face potential disruption if investors and analysts adopt overly conservative positions until greater clarity is obtained.

Corporate governance (CG) reformists typically presume better-governed companies are more transparent to investors. We focus on CG and transparency in Japan, where CG has been an ongoing issue. Using local ratings of Japanese companies’ CG and data on corporate disclosures and their associated stock returns, we do find better-governed Japanese companies have made more frequent and timelier disclosures, and their share prices have reflected value-relevant information earlier. While these results hold for good news, they do not hold for bad. Consequently, governance guidance in Japan may not have resulted in both timelier and more balanced release of newsworthy information.

Synopsis

The research problem

In recent decades, the Chinese government has taken several measures to liberalize its stock market to attract foreign investment. In this survey, we described these liberalization measures and reviewed the research on their consequences.

Motivation

Along with the rapid development of the Chinese stock market, increasing numbers of global investors have shown interest in this market. As a result, we also witness a steady growth in the number of empirical research and review studies published in the international journals. However, no published reviews have focused on stock market liberalization, which is an important perspective requiring further investigation. Our study bridges the gap by making a thorough and in-depth review on issues associated with the stock market liberalization in China.

The discussed questions and implications

In analyzing this literature, we focused on two dimensions: (1) how liberalization impacts five corporate-level accounting and financial issues—corporate governance, information environment and financial disclosure, earnings quality, value-relevance of accounting information, and auditing, and (2) how liberalization improves the Chinese stock market as a whole and affects asset pricing in this market. Based on the issues explored in the literature, we provide suggestions for future research in our concluding remarks.

This paper investigates the current state of corporate Australia's environmental management accounting practices and environmental management accountants' perceptions of how environmental management accounting information should be accounted for and reported in the annual report of an environmentally sensitive corporation. The results indicate that many Australian companies have not yet developed a holistic approach to environmental costing, and that environmental management accountants believe that environmentally induced costs and expenses should be reported as notes to financial statements, rather than in the profit and loss statement in the corporate annual report. However, results are inconclusive as to whether certain environmentally induced expenditure should be capitalised and amortised separately in the balance sheet, while there is some support for environmentally induced end-of-pipe and integrated technologies being recognised separately as assets in the balance sheet.

We examine voluntary and mandated disclosure of portfolio holdings by investment funds in a model where funds are characterized as having a stream of investment ideas and as providing liquidity to investors through redemption. We show that the greater is the fund's liquidity provision role, the more aggressively the fund trades on its ideas, the stronger is its preference to disclose information about its holdings voluntarily, and the weaker is its performance. We also show that mandatory disclosure can decrease information available in securities markets by crowding out the acquisition of private information that, through funds' trading, would be reflected in prices. Our model provides an explanation for why hedge funds and mutual funds differ in their resistance to public disclosure, and is consistent with stylized facts regarding how funds' investment decisions respond to poor performance and how differences in disclosure policies affect the future performance of well versus poorly performing funds.

In this paper, we explore how economic policy to support sustainability can coordinate efforts to tackle climate risk, overcome environmental challenges and ensure human security. The financial system faces very significant risks posed by climate change, as well as the transition to a low carbon economy. As such, the ESG framework as it is needs to be enhanced in order to be itself effective and sustainable. Hence, we propose an enhanced ESG framework that is grounded in strong Islamic fundamentals to anticipate gaps that can be exploited. Considering human relationships with the natural world from the perspective of Islamic teachings holds great promise for rethinking resource management and preservation. A fundamental role of humans in Islam is that of trustees of creation. The need to achieve sustainable economic development globally and its transition to a low-carbon economy requires strong policies and initiatives to drive green and sustainable finance for the purpose of achieving public policy objectives effectively.

The Sustainability Accounting Standards Board (SASB) is an independent nonprofit organization that sets standards for companies to use when disclosing Environmental, Social, and Governance (ESG) information to investors. SASB standards help companies publicly report consistent and comparable information about how they manage issues related to climate change, natural resource constraints, technological innovation, population growth, and more. As a result, the SASB standards enable investors to better understand how a company impacts — and is impacted by — a changing world. With this information in hand, investors can direct their capital to those companies that are being managed most effectively for the long term.

In Malaysia, the issues of corporate governance, transparency and disclosure have been the focus of researchers particularly after the economic turmoil in 1997. Weakening corporate governance in many firms is one of the factors that contributed to the 1997 Asian financial crisis. This study mainly examines how ownership structures are associated with the directors' compensation disclosure among 100 largest listed companies in Malaysia. A number of studies have looked into the ownership structure in Malaysian companies, however, none of the research has explored the issue of directors' compensation disclosure. Disclosure and governance environment are found to be the predominant factors in enhancing firm value. Therefore, to avoid any pressure from regulatory authorities and to reduce the gap between management and investors, firms should disclose more. The study uses a directors' compensation disclosure checklist to score the items in the annual reports and multiple regression analysis to examine the association between ownership structure and the extent of directors' compensation disclosure. The finding of this study revealed that the government ownership was positively associated and statistically significant at 1% level with the extent of directors' compensation disclosure, while the percentage of family members on the board is negatively associated to the extent of directors' compensation disclosure.