دانلود رایگان مقاله گزارش موقعیت مکانی و سنجش ارتباط اطلاعات حسابداری

ABSTRACT

This paper examines the influence of reporting location on the value relevance of other comprehensive income (OCI). Accounting Standards Update (ASU) 2011-05 “Presentation of Comprehensive Income” requires firms to report OCI in a performance statement (i.e., either below net income in a single statement of comprehensive income or in a second statement of comprehensive income that begins with net income). ASU 2011-05 eliminated the option of reporting OCI in the statement of equity, based on the argument that performance reporting would improve the transparency of OCI in the financial statements. We find mixed evidence that the value relevance of OCI differs across management's choices of OCI reporting location prior to the implementation of ASU 2011-05. However, we do find a decline in the value relevance of OCI for firms that were required to change the reporting location of OCI from the statement of equity to a performance statement in response to ASU 2011-05. This result holds after we include a control group consisting of firms that did not change the reporting location of OCI. Overall, our findings suggest that the value relevance of OCI is determined by whether its reporting location is consistent with the firm's reporting history.

5. Conclusions

This paper examined the influence of reporting location on the value relevance of OCI in light of the passage of ASU 2011-05 “Presentation of Comprehensive Income” which requires firms to report the components of OCI in a performance statement (i.e., either below the components of net income in a single statement of comprehensive income or in a second statement of comprehensive income that begins with total net income). ASU 2011-05 eliminated the option of reporting OCI in the statement of equity on the basis that performance reporting would improve the transparency of financial statements by reporting OCI in a more prominent location. Using a difference-in-difference design, we document a decline in the value relevance of OCI for firms that were required to change the reporting location of OCI from the statement of equity to a performance statement in response to ASU 2011-05. Given that performance reporting is commonly perceived as the more transparent and therefore preferable OCI reporting approach, this finding is of potential interest to standard setters and practitioners. Together with prior evidence, our findings indicate that the value relevance of OCI is higher when a firm's reporting location of OCI is consistent with its reporting history