Properties of accounting earnings in Latin American countries: Timeliness and conservatism (Argentina, Brazil, Chile, Colombia).

摘要

This paper investigates institutional factors that influence the demand for accounting earnings across five Latin American countries, Argentina, Brazil, Chile, Colombia, and Venezuela. Two types of institutional factors are considered in this study, country specific and firm-specific. The countries' institutional factors that influence the demand for accounting earnings are source of local General Accepted Accounting Principles (GAAP), level of corruption, and utilization of International Accounting Standards (IAS). The firm-specific factors deemed to influence the demand for accounting earnings are whether the firm is cross-listed and/or whether the government exercises control over the firm.; Ball, et al. (2000) show that the demand for accounting earnings in different institutional contexts results in differences in the properties of earnings across countries. The properties of accounting earnings I study in this context are timeliness and conservatism, as defined in Basu (1997).; The results show that the sources of GAAP affect conservatism. If the influence of private standard setters is higher, conservatism tends to be higher. The evidence also indicates that the utilization of IAS results in higher timeliness and conservatism. The firm-specific characteristics, cross-listing, and government ownership do not seem to influence timeliness and conservatism.; This study contributes to the accounting literature in several ways. First, it provides information that addresses concerns of the Securities and Exchange Commission (SEC) about the comparability and transparency of accounting information across countries. Second, the results show that private sector-led accounting regime is more appropriate for emerging economies, and lastly, it provides information on how the process of converging the local accounting standards with IAS affects the properties of accounting earnings.