Segmental reporting, accounting enforcement, and analyst forecast dispersion in the European Union

Ahmed Aboud

Journal of International Accounting, Auditing and Taxation, 2023, vol. 53, issue C

Abstract: This paper investigates the relationship between segmental reporting and analyst forecast dispersion in the largest European Union firms. It also addresses how the adoption of International Financial Reporting Standard 8 (IFRS8) and the strength of country-level enforcement affect this relationship. I find a positive relationship between segmental reporting and analyst forecast dispersion. However, the results of sub-sample analyses reveal a negative relationship between segmental reporting and analyst forecast dispersion in countries with strong enforcement systems. Furthermore, this paper documents that the positive relationship between segmental reporting and analyst forecast dispersion is pronounced only in the Pre-IFRS8 period. These findings suggest that country-level enforcement compensates for lower segmental reporting quality, and the adoption of IFRS8 improves the quality of segmental reporting.

Keywords: IFRS8; Analyst forecast dispersion; Segmental reporting; Enforcement; Europe (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jiaata:v:53:y:2023:i:c:s1061951823000629

DOI: 10.1016/j.intaccaudtax.2023.100583

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