The market valuation of IAS versus US-GAAP accounting measures using Form 20-F reconciliations

Mary S. Harris, Karl A. Muller, III

Research output: Contribution to journalArticle

146 Scopus citations

Abstract

We investigate the market valuation of earnings and book value amounts prepared under IAS and US-GAAP to provide evidence for the debate between the US SEC and NYSE on whether foreign firms should be allowed to list in the US using IAS. We find that the US-GAAP earnings reconciliation adjustment is value-relevant and that US-GAAP amounts are valued differently for market value and return models, but not a price-per-share model. We also find that IAS amounts are more highly associated with price-per-share than US-GAAP amounts, and that US-GAAP amounts are more highly associated with security returns than IAS amounts.

Original languageEnglish (US)
Pages (from-to)285-312
Number of pages28
JournalJournal of Accounting and Economics
Volume26
Issue number1-3
DOIs
StatePublished - Jan 1999

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics

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