Bernard Raffournier

The determinants of voluntary financial disclosure by Swiss listed companies

The aim of this paper is to relate the extent of disclosure in the annual reports of Swiss listed companies to possible determinants representing agency and political costs. The choice of Switzerland is based on the fact that, prior to the implementation of the new company law on 1 July 1992 Swiss disclosure requirements were very low, so that the major part of the content of the annual report could be considered as voluntarily disclosed. The sample includes the 1991 annual report of 161 industrial and commercial firms. The extent of disclosure is measured by an index based on information whose disclosure is required by the Fourth and Seventh EU Directives. Independent variables are measures of company size, leverage, profitability, ownership structure, internationality, auditors size, percentage of fixed assets and industry type. Relations are assessed using univariate analyses and multiple regressions. The main result is that size and internationality play a major role in the disclosure policy of firms, large and internationally diversified companies tending to disclose more information than small purely domestic enterprises.

Accounting and capital markets: a survey of the European evidence

The relationship between accounting information and capital markets has been the subject of numerous studies, especially in the US. The purpose of this article is to examine the corresponding evidence in Europe. This review classifies the European literature into three groups: studies of the market reaction to newly released accounting information; studies of the long-term association between stock returns and accounting numbers; studies devoted to the use of accounting data by investors and to the impact of market pressure on accounting choices. The paper reviews and summarizes the main results related to each of these topics. It also addresses some methodological issues and provides suggestions for future research.

The value relevance of earnings in Europe after IFRS implementation: why do national differences persist?

Since 2005, all European listed companies must comply with IFRS in the preparation of their consolidated financial statements. Several studies have investigated the consequences of this political decision, comparing various dimensions of accounting quality before and after IFRS implementation. But they do not really address the following question: will the adoption of a common set of accounting standards result in a standardisation of accounting quality throughout Europe, or will national differences persist due to the influence of local characteristics? In order to provide evidence on this issue, we measure the value relevance of accounting earnings in 16 European countries over the period 2006–2007. The results show that country differences persist despite the use of common accounting standards, which is consistent with the idea that legal and regulatory country characteristics as well as market forces still impact the association between market returns and accounting data.

The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Switzerland

Abstract Although Switzerland is not a member of the European Union, the EU directives have largely influenced the Swiss accounting regulation. IFRS also have been highly influential since many large companies used them long before they became mandatory for listed firms. Moreover, IFRS served as a benchmark for the development of Swiss GAAP. This article compares the current Swiss accounting regulation to the new EU accounting directive and to IFRS. Despite many similarities, the Swiss regulation retains major specificities, the most notable being the permission of hidden reserves.