Book chapter
DISCLOSURE VERSUS RECOGNITION IN STOCK-OPTION REPORTING: ARE SOPHISTICATED USERS' PERCEPTIONS AND JUDGMENTS INFLUENCED BY THE REPORTING FORMAT?
Advances in accounting behavioral research, pp 31-57
01 Jan 2008
Abstract
The recently passed Statement Financial of Accounting Standard (SFAS) 123R mandates that stock-option compensation costs be recognized in the income statement. This supersedes SFAS 148 and the earlier SFAS 123 which required only disclosure in the notes to the financial statements. The motivation of the Financial Accounting Standards Board (FASB) was to increase transparency in reporting of financial statements. The objective of this chapter is to test whether sophisticated users' perceptions and judgments are affected by the different reporting format that has been mandated by SFAS 123R. Members of the Institute of Management Accountants (IMA) were used as the participants in this study. The study finds a (1) higher perceived risk, (2) lower expected accounting return, (3) more pessimistic overall perception, (4) more negative future stock price direction, and (5) lower stock price valuation by sophisticated users in the presence of recognition versus disclosure. These findings support the stance of the FASB and indicate that that information content is accentuated in the presence of recognition relative to disclosure.
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Details
- Title
- DISCLOSURE VERSUS RECOGNITION IN STOCK-OPTION REPORTING: ARE SOPHISTICATED USERS' PERCEPTIONS AND JUDGMENTS INFLUENCED BY THE REPORTING FORMAT?
- Creators
- Asokan Anandarajan - MT School of ManagementRejean Belzile - Univ Quebec, Dept Accounting, Montreal, PQ H3C 3P8, CanadaAnthony P. Curatola - Drexel UniversityChantal Viger - Univ Quebec, Dept Accounting, Montreal, PQ H3C 3P8, Canada
- Contributors
- Arnold (Editor)B D Clinton (Editor)A Lillis (Editor)R Roberts (Editor)C Wolfe (Editor)S Wright (Editor)
- Publication Details
- Advances in accounting behavioral research, pp 31-57
- Series
- Advances in Accounting Behavioral Research
- Publisher
- Emerald Group Publishing; BINGLEY
- Number of pages
- 27
- Resource Type
- Book chapter
- Language
- English
- Academic Unit
- Accounting; Physical Therapy (and Rehabilitation Sciences)
- Web of Science ID
- WOS:000270893500002
- Scopus ID
- 2-s2.0-84856660621
- Other Identifier
- 991019168759104721
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Business
- Management
- Psychology, Multidisciplinary