IDEAS home Printed from https://ideas.repec.org/a/taf/euract/v7y1998i1p31-40.html
   My bibliography  Save this article

A note on the information content of parent company versus consolidated earnings in Finland

Author

Listed:
  • Jyrki Niskanen
  • Juha Kinnunen
  • Eero Kasanen

Abstract

Little empirical research has been focused on analysing the information content of consolidated versus parent-only earnings numbers. In most European countries corporate annual reports include parent company statements, whereas in the USA only consolidated financial statements are available to shareholders. Using accounting and market data from thirty-five Finnish listed firms, we examine the information content of consolidated versus parent-only earnings, after controlling for each other. The results show that consolidated earnings are a significant incremental explanatory variable for stock returns, while parent-only earnings are not. The findings suggest that consolidation improves the information content of earnings, and the requirement to disclose parent-only earnings should be based on arguments other than their value-relevance to shareholders.

Suggested Citation

  • Jyrki Niskanen & Juha Kinnunen & Eero Kasanen, 1998. "A note on the information content of parent company versus consolidated earnings in Finland," European Accounting Review, Taylor & Francis Journals, vol. 7(1), pages 31-40.
  • Handle: RePEc:taf:euract:v:7:y:1998:i:1:p:31-40
    DOI: 10.1080/096381898336565
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/096381898336565
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Beaver, William H. & Griffin, Paul A. & Landsman, Wayne R., 1982. "The incremental information content of replacement cost earnings," Journal of Accounting and Economics, Elsevier, vol. 4(1), pages 15-39, July.
    2. Kane, Alex & Lee, Young Ki & Marcus, Alan, 1984. " Earnings and Dividend Announcements: Is There a Corroboration Effect?," Journal of Finance, American Finance Association, vol. 39(4), pages 1091-1099, September.
    3. Brown, Stephen J. & Warner, Jerold B., 1980. "Measuring security price performance," Journal of Financial Economics, Elsevier, vol. 8(3), pages 205-258, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pascal Dumontier & Bernard Raffournier, 2002. "Accounting and capital markets: a survey of the European evidence," European Accounting Review, Taylor & Francis Journals, vol. 11(1), pages 119-151.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:euract:v:7:y:1998:i:1:p:31-40. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/REAR20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.