The impact of US experience on financial reporting comparability between Chinese firms and their US industry peers

Ao Shu, Ziru Lian, Lili Jiu, Wei Zhang and Fengwen Chen

International Review of Financial Analysis, 2025, vol. 107, issue C

Abstract: This paper explores the effect of US-experienced managership on financial reporting comparability. By analyzing a sample of Chinese A-share companies listed on the Shanghai and Shenzhen Stock Exchanges from 2008 to 2020, we discover that firms with US-experienced managers appointment exhibit greater comparability to US peers. Further, the positive relationship between US-experienced managers and financial reporting comparability is more pronounced when the managers have practical work experience and master's degree in the US. Considering external factors, the presence of US experience within firms enhances comparability more effectively when the firms operate in less competitive industries and more developed regions. In addition, we demonstrate that firms with US-experienced managers attract greater foreign investment, are more likely to achieve successful overseas IPOs, and exhibit lower analyst forecast dispersion, driven by heightened comparability. The findings indicate that enhanced comparability is the key mechanism drawing foreign investors and facilitating the firm's expansion into international markets.

Keywords: Overseas experience; Accounting comparability; QFII; Overseas IPO; Peer firms (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:107:y:2025:i:c:s1057521925007185

DOI: 10.1016/j.irfa.2025.104631

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