The moderating effect of voluntary disclosure on the relation between earnings quality and information asymmetry: some Canadian evidence

Denis Cormier, Marie-Josée Ledoux and Michel Magnan ()

International Journal of Accounting, Auditing and Performance Evaluation, 2012, vol. 8, issue 2, 157-183

Abstract: This study investigates how web-based voluntary disclosure affects the relation between earnings quality and information asymmetry, considering governance attributes. Our results show that both earnings quality and web-based disclosure are associated with reduced information asymmetry. In addition, web-based disclosure has a moderating effect on the relation between earnings quality and information asymmetry, irrespective of earnings quality. This is consistent with the argument that stock market participants assess the quality of financial reporting taking into account a firm's overall disclosure strategy. Finally, corporate governance is found to underlie both disclosure and earnings quality.

Keywords: web-based disclosure; earnings quality; corporate governance; information asymmetry; Canada; voluntary disclosure; financial disclosure; financial reporting. (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijaape:v:8:y:2012:i:2:p:157-183

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