Journal of Accounting Research最新文献

Complexity in applying financial accounting standards can have real operational effects if firms alter their actions in response to increased reporting costs. We examine whether the introduction of ASU 2017-12, designed to reduce compliance burden and better align hedge accounting rules with risk management practices, led to more effective hedging. Using detailed hedging disclosures, we show that firms that adopt the ASU expand the use of hedge-accounted derivatives and reduce exposures to interest rate and foreign currency risks. ASU-adopting firms also reduce cash flow volatility, increase their use of debt, invest more, and reduce information asymmetry in the equity market. Our analyses reveal that easing hedge effectiveness tests and reliefs targeting “cash flow hedges” and “net investment hedges of foreign operations” were the most influential of the ASU's reforms. Our study is the first to integrate the effects of hedge accounting frictions on firms’ risk management activities and resulting spillovers to debt financing and investments.

We adopt a financial-materiality approach in studying the costs and benefits of measuring greenhouse gas (GHG) emissions on social welfare. Production by firms internally generates direct GHG emissions (Scope 1 emissions) whereas outsourcing to suppliers generates indirect emissions (Scope 3 emissions). Our analysis incorporates two frictions: (1) long-term negative environmental externalities caused by emissions and (2) fragmentation in regulating emissions disclosures across jurisdictions. We show firms' failure to internalize the environmental externalities provides a rationale for mandating Scopes 1 and 3 emissions disclosures. However, such disclosures induce emissions leakage. Disciplining emissions leakage calls for setting complementary—rather than independent—disclosure requirements for Scopes 1 and 3 emissions. Our analysis underscores the importance of improving the reliability of Scope 3 emissions measurements given that measurements of Scope 1 emissions are highly reliable for public firms in Europe and the United States. Regulators can further enhance the disciplinary effects of Scope 3 emission measurements by requiring the allocations of Scope 3 emissions in supply chains to individual firms, especially when allocating Scope 3 emissions is more reliable, and for firms/industries that are more prone to transition climate risk relative to physical climate risk.

Using consumer complaints filed with the Consumer Financial Protection Bureau as a measure for the quality of financial products and services, we present evidence of racial disparities in the service quality received by consumers. Consumers in high-minority communities file more complaints than those in low-minority communities, and the racial gap in financial complaints increased by more than 60% during the COVID-19 pandemic. Using a triple-difference approach, we establish the role of corporate social attitudes, reflected in, for example, inclusive promotion practices and diversity in leadership, in mitigating the complaint racial gap and its pandemic-period increase. Our results shed light on how inclusive corporate culture filters through an organization to benefit minority communities and underscore the effect of corporate social attitudes on important stakeholder outcomes.

This correction describes errors in the program code of Breuer [2021] and presents revised results. The errors affect the construction of the standardized reporting and auditing scopes, the treatment variables of the primary research design in Breuer [2021]. The revised results show weaker evidence that reporting mandates facilitate ownership dispersion in capital markets compared to Breuer [2021]. They also show weaker evidence that reporting mandates spur competition in product markets, including mixed evidence on product-market entry. Consistent with Breuer [2021], the revised results continue to show no unambiguous evidence that reporting mandates improve the efficiency of industry-wide resource allocation. With respect to audit mandates, the revised results continue to show evidence that the mandates impose a barrier to entry. Overall, the correction indicates that the impacts of reporting and auditing mandates are even more uncertain than reported in Breuer [2021] and that further research on these impacts is called for.