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Response to Discussion of “Security Returns and Volume Responses around International Financial Reporting Standards (IFRS) Earnings Announcements”

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  • Olibe, Kingsley O.

Abstract

This paper responds to Perkins' (2016) preferred methodology—association study rather than the use of an event study research design in Olibes' (2016) paper (Security Returns and Volume Responses around International Financial Reporting Standards (IFRS) Earnings Announcements). As noted by Collins and Kothari (1989), association studies recognize that investors likely learn “information about earnings and valuation relevant events from non-accounting information sources." As Callen et al (2009, 1364) note, event study analyses provide more direct evidence regarding the information conveyed of earnings disclosures. Most notably, in an empirical setting in which the focus is on testing the impact of new earnings information on stock returns and trading volume, it is vital to know when information arrives and the duration investors use that information in making investing and trading decisions. This reasoning justifies the methodology employed in Olibe (2016).

Suggested Citation

  • Olibe, Kingsley O., 2016. "Response to Discussion of “Security Returns and Volume Responses around International Financial Reporting Standards (IFRS) Earnings Announcements”," The International Journal of Accounting, Elsevier, vol. 51(2), pages 271-274.
    • Handle: RePEc:eee:accoun:v:51:y:2016:i:2:p:271-274
    DOI: 10.1016/j.intacc.2016.04.005
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    References listed on IDEAS

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    1. Morse, D, 1981. "Price And Trading Volume Reaction Surrounding Earnings Announcements - A Closer Examination," Journal of Accounting Research, Wiley Blackwell, vol. 19(2), pages 374-383.
    2. Ball, Ray & Kothari, S. P. & Robin, Ashok, 2000. "The effect of international institutional factors on properties of accounting earnings," Journal of Accounting and Economics, Elsevier, vol. 29(1), pages 1-51, February.
    3. Richard Lambert & Christian Leuz & Robert E. Verrecchia, 2007. "Accounting Information, Disclosure, and the Cost of Capital," Journal of Accounting Research, Wiley Blackwell, vol. 45(2), pages 385-420, May.
    4. Collins, Daniel W. & Kothari, S. P., 1989. "An analysis of intertemporal and cross-sectional determinants of earnings response coefficients," Journal of Accounting and Economics, Elsevier, vol. 11(2-3), pages 143-181, July.
    5. Perkins, Jon D., 2016. "Discussion of “Security Returns and Volume Responses around International Financial Reporting Standards (IFRS) Earnings Announcements”," The International Journal of Accounting, Elsevier, vol. 51(2), pages 266-270.
    6. Ball, Ray & Kothari, S. P. & Robin, Ashok, 2000. "Corrigendum to "The effect of international institutional factors on properties of accounting earnings"; [Journal of Accounting and Economics 29 (2000) 1-51]," Journal of Accounting and Economics, Elsevier, vol. 30(2), pages 241-241, October.
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    Cited by:

    1. Perkins, Jon D., 2016. "Discussion of “Security Returns and Volume Responses around International Financial Reporting Standards (IFRS) Earnings Announcements”," The International Journal of Accounting, Elsevier, vol. 51(2), pages 266-270.
    2. Georgakopoulos, Georgios & Gounopoulos, Dimitrios & Huang, Chen & Patsika, Victoria, 2022. "The impact of IFRS adoption on IPOs management earnings forecasts in Australia," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 48(C).
    3. Edward A. E. Jones & Anthony K. Kyiu & Hao Li, 2021. "Earnings informativeness and trading frequency: Evidence from African markets," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 1064-1086, January.
    4. Figlioli, Bruno & Lemes, Sirlei & Lima, Fabiano Guasti, 2020. "In search for good news: The relationship between accounting information, bounded rationality and hard-to-value stocks," Emerging Markets Review, Elsevier, vol. 44(C).

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    More about this item

    Keywords

    M41; Security Returns; Information Content; IFRS; Trading Volume and earnings disclosures;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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