Title: Board characteristics, IFRS adoption and voluntary disclosure: evidence from management forecasts accuracy in France
Authors: Khawla Hlel; Ines Kahloul Nafti
Addresses: Higher Institute of Accounting and Business Administration, University of Manouba, University Campus of Manouba-2010 Tunis, Tunisia ' Higher Institute of Management of Sousse, Street of Abdlaaziz il Behi, Bp 763, 4000, Sousse, Tunisia
Abstract: In this article, we examine whether the IFRS adoption and the strong corporate board contribute effectively to reduce the information asymmetry by enhancing the quality of voluntary disclosure in the case of French IPOs. Our measure of disclosure quality is denoted by the absolute forecast error as a proxy for management earnings forecasts accuracy. We find evidence that the adoption of IFRS gives a credible signal of higher disclosure quality and lower information asymmetry through the improvement of the management earnings forecasts accuracy. Also, we find that the independent and larger boards do play an important role in promoting corporate transparency by conveying more accurate earnings forecasts. These findings suggest that future shareholders can benefit from receiving better forecasts. Accurate management forecasts can allow them to identify the companies they want to invest in, and to reduce the costs of adverse selection that they have to face.
Keywords: board characteristics; IFRS adoption; voluntary disclosure; management forecasts; forecasts accuracy; initial public offerings; IPO; France.
International Journal of Management and Enterprise Development, 2019 Vol.18 No.1/2, pp.41 - 62
Received: 31 Jan 2018
Accepted: 25 Apr 2018
Published online: 11 Feb 2019 *