An Investigation of the Impact of the Issuance of FRS 12 Provisions, Contingent Liabilities and Contingent Assets on the Share Prices of UK Oil and Gas Companies

摘要

Despite a plethora of academic studies, no general conclusions have emerged concerning the association between share price changes and the adoption of new accounting regulations (Ball and Brown, 1968; Beaver, 1972; Gondes, 1972; Gonedes and Dupoch, 1974; Lev and Ohlson, 1982; Belkaoui, 1992). In fact, the evidence avilable from the extant literature is still somewhat inconclusive on the significance of any association between share returns and the adoption of new accounting standards. This is especially true in the UK where less analysis has been undertaken than in the US and where the implication of any proposed accounting regulation is often unclear because of the wide range of accounting options normally available to preparers of financial statements. On reflection, this lack of hard empirical evidence may be due to market-based accounting research being "plagued" by methodological problems, such as the problematic question of identifying the appropriate measurement interval and choosing the ideal expected returns model against which abnormal returns are to be measured (Foster, 1980; Ball and Forster, 1982; Strong, 1992). In addition, the problem of "noise" pollutioin caused by prior leakage of information has to be explored. Despite these off-putting barriers to carrying out fruitful research in this area, some comfort can be drawn from studies which have amassed relatively more consistent and conclusive evidence and might have been expected (Lev and Ohlson, 1982).