Cost of capital and earnings transparency

• Autores: Mary E. Barth, Yaniv Konchitchki, Wayne R. Landsman
• Localización: Journal of accounting and economics, ISSN 0165-4101, Vol. 55, Nº. 2-3, 2013, págs. 206-224
• Idioma: inglés
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• Dialnet Métricas: 3 Citas
• Resumen

  • We provide evidence that firms with more transparent earnings enjoy a lower cost of capital. We base our earnings transparency measure on the extent to which earnings and change in earnings covary contemporaneously with returns. We find a significant negative relation between our transparency measure and subsequent excess and portfolio mean returns, and expected cost of capital, even after controlling for previously documented determinants of cost of capital.