Strategic accounting choices and the diversification discount

Storie, Alastair. (2005). Strategic accounting choices and the diversification discount Honours Thesis, School of Business, The University of Queensland.

       
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Author Storie, Alastair.
Thesis Title Strategic accounting choices and the diversification discount
School, Centre or Institute School of Business
Institution The University of Queensland
Publication date 2005
Thesis type Honours Thesis
Total pages 35
Language eng
Subjects 1501 Accounting, Auditing and Accountability
Formatted abstract
As of January 1 1998, the regulation governing segment disclosure in the U.S., SFAS 14, was replaced with a new standard, SFAS 131. It was hoped that this new standard would eliminate some of the discretion that was argued to exist under SFAS14. This study examines the effect that the regulatory change had on measurement of Tobin's Q and by implication, the motivations of managers to withhold information under SFAS 14. This study finds that Tobin's Q is significantly higher in the post-SFAS 131 period. This result provides support for the contention that firms were using the discretion under SFAS 131 to conceal profitable results. Further, this behaviour is likely to have had an impact on previous measures of the diversification discount, although the possibility of omitted correlated variables in this study cannot be discounted.
Additional Notes Variant title: Segment reporting and the diversification discount.

 
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Created: Thu, 18 Nov 2010, 17:19:43 EST by Muhammad Noman Ali on behalf of The University of Queensland Library