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International differences in R&D disclosure practices: Evidence in a French and Canadian context

Author

Listed:
  • Yuan Ding

    (CEIBS - Europe International Business School)

  • Gary Entwistle
  • Hervé Stolowy

    (GREGH - Groupement de Recherche et d'Etudes en Gestion à HEC - HEC Paris - Ecole des Hautes Etudes Commerciales - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper compares the R&D disclosure practices in France and Canada, as evidenced in the annual reports of 76 French and 110 Canadian listed companies. It finds that Canadian high-tech companies (hardware, software, and biotechnology) disclose significantly more information on their R&D activities than their French counterparts. It also finds a strong link between R&D intensity and R&D disclosure among Canadian high-tech companies. Canadian companies overall are also found to be more likely to use non-financial disclosure as a means to resolve any R&D information asymmetry, while French firms disclose more traditional financial and accounting information. Canadian companies are also more willing than French firms to provide information concerning their future R&D expenditures. These results are consistent with inherent cultural and capital market differences between France and Canada. In contrast, the study does not find any significant difference in R&D expenditure capitalization policies between French and Canadian firms.

Suggested Citation

  • Yuan Ding & Gary Entwistle & Hervé Stolowy, 2003. "International differences in R&D disclosure practices: Evidence in a French and Canadian context," Working Papers hal-00591687, HAL.
    • Handle: RePEc:hal:wpaper:hal-00591687
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    References listed on IDEAS

    as
    1. David S. Gelb, 2002. "Intangible Assets and Firms' Disclosures: An Empirical Investigation," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 29(3‐4), pages 457-476, April.
    2. Gamble, George O. & Hsu, Kathy & Jackson, Cynthia & Tollerson, Cynthia D., 1996. "Environmental disclosures in annual reports: An international perspective," The International Journal of Accounting, Elsevier, vol. 31(3), pages 293-331.
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    4. David S. Gelb, 2002. "Intangible Assets and Firms' Disclosures: An Empirical Investigation," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 29(3&4), pages 457-476.
    5. Basu, Sudipta, 1997. "The conservatism principle and the asymmetric timeliness of earnings," Journal of Accounting and Economics, Elsevier, vol. 24(1), pages 3-37, December.
    6. Bernard Raffournier, 1995. "The determinants of voluntary financial disclosure by Swiss listed companies," European Accounting Review, Taylor & Francis Journals, vol. 4(2), pages 261-280.
    7. George E. Pinches & V. K. Narayanan & Kathryn M. Kelm, 1996. "How The Market Values The Different Stages Of Corporate R&D—Initiation, Progress, And Commercialization," Journal of Applied Corporate Finance, Morgan Stanley, vol. 9(1), pages 60-70, March.
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    Cited by:

    1. Gamal Atallah & Massoud Khazabi, 2005. "A Model of R&D Capitalization," International Journal of Business and Economics, School of Management Development, Feng Chia University, Taichung, Taiwan, vol. 4(2), pages 107-121, August.

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    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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