Accounting Standards and International Portfolio Holdings: Analysis ofCross-border Holdings Following Mandatory Adoption of IFRS.

Accounting Harmonization;IFRS;Capital Flows;Cross Border Mutual Fund Holdings;Economics;Business;Business Administration

Yu, GowoonZhang, Jing ;

University of Michigan

关键词: Accounting Harmonization;    IFRS;    Capital Flows;    Cross Border Mutual Fund Holdings;    Economics;    Business;    Business Administration;   

Others  :  https://deepblue.lib.umich.edu/bitstream/handle/2027.42/77800/gowoonyu_1.pdf?sequence=1&isAllowed=y

瑞士|英语

来源: The Illinois Digital Environment for Access to Learning and Scholarship

【 摘 要 】

Prior literature shows that investors under-invest in foreign firms due to information asymmetry problems.I posit that differences in local accounting standards are a source of the information asymmetry among investors.Using security-level holdings of international mutual funds, I find that harmonizing accounting standards (adoption of IFRS) increases foreign mutual fund holdings.Harmonizing accounting standards increases cross-border holdings 1) directly by reducing the information processing cost of foreign investors and 2) indirectly by reducing the effect of other barriers on cross-border investments such as geographic distance.Further analysis suggests that differences in the enforcement of the standards are sufficient to curb the benefits of accounting harmonization.