IDEAS home Printed from https://ideas.repec.org/a/ebl/ecbull/eb-08m40002.html
   My bibliography  Save this article

Is the Convergence of Accounting Standards Good for Stock Markets?

Author

Listed:
  • Terence Tai-Leung Chong

    (Department of Economics, The Chinese University of Hong Kong)

  • Winnie S. C. Leung

    (School of Accountancy, The Chinese University of Hong Kong)

  • Rita W. Y. Yip

    (School of Accountancy, The Chinese University of Hong Kong)

  • Howard Z. Huang

    (School of Accountancy, The Chinese University of Hong Kong)

Abstract

This paper examines the impact of the convergence of Hong Kong Accounting Standard 40 (HKAS 40) with the International Financial Reporting Standard (IFRS) on the stock prices of firms in the property industry. Using a sample of 22111 firm-day observations, we show that the new standard has a negative impact on the stock performance of these firms.

Suggested Citation

  • Terence Tai-Leung Chong & Winnie S. C. Leung & Rita W. Y. Yip & Howard Z. Huang, 2009. "Is the Convergence of Accounting Standards Good for Stock Markets?," Economics Bulletin, AccessEcon, vol. 29(3), pages 2079-2085.
    • Handle: RePEc:ebl:ecbull:eb-08m40002
    as

    Download full text from publisher

    File URL: http://www.accessecon.com/Pubs/EB/2009/Volume29/EB-09-V29-I3-P57.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Ball, R & Brown, P, 1968. "Empirical Evaluation Of Accounting Income Numbers," Journal of Accounting Research, Wiley Blackwell, vol. 6(2), pages 159-178.
    2. Schipper, K & Thompson, R, 1983. "The Impact Of Merger-Related Regulations On The Shareholders Of Acquiring Firms," Journal of Accounting Research, Wiley Blackwell, vol. 21(1), pages 184-221.
    3. Armitage, Seth, 1995. "Event Study Methods and Evidence on Their Performance," Journal of Economic Surveys, Wiley Blackwell, vol. 9(1), pages 25-52, March.
    4. Fama, Eugene F, et al, 1969. "The Adjustment of Stock Prices to New Information," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 10(1), pages 1-21, February.
    5. Fama, Eugene F & French, Kenneth R, 1995. "Size and Book-to-Market Factors in Earnings and Returns," Journal of Finance, American Finance Association, vol. 50(1), pages 131-155, March.
    6. Haidan Li & Morton Pincus & Sonja Olhoft Rego, 2008. "Market Reaction to Events Surrounding the Sarbanes-Oxley Act of 2002 and Earnings Management," Journal of Law and Economics, University of Chicago Press, vol. 51(1), pages 111-134, February.
    7. A. Craig MacKinlay, 1997. "Event Studies in Economics and Finance," Journal of Economic Literature, American Economic Association, vol. 35(1), pages 13-39, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dionysia Dionysiou, 2015. "Choosing Among Alternative Long-Run Event-Study Techniques," Journal of Economic Surveys, Wiley Blackwell, vol. 29(1), pages 158-198, February.
    2. Gokhale, Jayendra & Brooks, Raymond M. & Tremblay, Victor J., 2014. "The effect on stockholder wealth of product recalls and government action: The case of Toyota's accelerator pedal recall," The Quarterly Review of Economics and Finance, Elsevier, vol. 54(4), pages 521-528.
    3. Kothari, S. P., 2001. "Capital markets research in accounting," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 105-231, September.
    4. Bogdan Capraru & Iulian Ihnatov & Nicu Sprincean, 2016. "Changes of Executives and Ownership in a Romanian Small Bank: an Event Study Approach," EuroEconomica, Danubius University of Galati, issue 1(35), pages 36-46, may.
    5. Doan, Minh Phuong & Sercu, Piet, 2021. "Modelling multiperiod patterns in stock-market reactions to events, with an application to serial acquisitions," International Review of Financial Analysis, Elsevier, vol. 77(C).
    6. Ferguson, Colin & Finn, Frank & Hall, Jason & Pinnuck, Matt, 2010. "Speculation and e-commerce: The long and the short of IT," International Journal of Accounting Information Systems, Elsevier, vol. 11(2), pages 79-104.
    7. Liu, Haiyue & Wang, Yile & Shi, Xiaoshuang & Pang, Lina, 2022. "How do environmental policies affect capital market reactions? Evidence from China's construction waste treatment policy," Ecological Economics, Elsevier, vol. 198(C).
    8. James Koch & Robert Fenili & Richard Cebula, 2011. "Do Investors Care if Steve Jobs is Healthy?," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 39(1), pages 59-70, March.
    9. Omer Ahmed Sayed & Hussein Eledum, 2023. "The short‐run response of Saudi Arabia stock market to the outbreak of COVID‐19 pandemic: An event‐study methodology," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 2367-2381, July.
    10. Bogdan Capraru & Iulian Ihnatov & Nicu Sprincean, 2016. "The Effect Of Major Events On Bank Share Price In Romania," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 747-757, July.
    11. Wijayana, Singgih & Gray, Sidney J., 2018. "Capital market consequences of cultural influences on earnings: The case of cross-listed firms in the U.S. stock market," International Review of Financial Analysis, Elsevier, vol. 57(C), pages 134-147.
    12. Monica Martinez-Blasco & Vanessa Serrano & Francesc Prior & Jordi Cuadros, 2023. "Analysis of an event study using the Fama–French five-factor model: teaching approaches including spreadsheets and the R programming language," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-34, December.
    13. Rolf Uwe Fülbier & Thorsten Sellhorn, 2023. "Understanding and improving the language of business: How accounting and corporate reporting research can better serve business and society," Journal of Business Economics, Springer, vol. 93(6), pages 1089-1124, August.
    14. K. Chau & S. Wong & C. Yiu & Maurice Tse & Frederik Pretorius, 2010. "Do Unexpected Land Auction Outcomes Bring New Information to the Real Estate Market?," The Journal of Real Estate Finance and Economics, Springer, vol. 40(4), pages 480-496, May.
    15. ATM Adnan, 2018. "Home vs. Cross-Border Takeovers: Is There Any Difference in Investor Perception?," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2018(2), pages 59-84.
    16. DAVID E. ALLEN & MICHAEL McALEER & ROBERT J. POWELL & ABHAY K. SINGH, 2018. "Non-Parametric Multiple Change Point Analysis Of The Global Financial Crisis," Annals of Financial Economics (AFE), World Scientific Publishing Co. Pte. Ltd., vol. 13(02), pages 1-23, June.
    17. Erica X. N. Li & Dmitry Livdan & Lu Zhang, 2009. "Anomalies," The Review of Financial Studies, Society for Financial Studies, vol. 22(11), pages 4301-4334, November.
    18. ATM Adnan & Sameer Al Johani, 2023. "Stock Market Reaction to COVID-19: A Cross-Sectional Industry Analysis in Frontier Market," IIM Kozhikode Society & Management Review, , vol. 12(2), pages 157-181, July.
    19. Bert Scholtens & Marélie Steensma, 2002. "Stocks and shocks," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 55(223), pages 347-361.
    20. Saty Patrabansh & William M. Doerner & Samuel Asin, 2014. "The Effects of Monetary Policy on Mortgage Rates," FHFA Staff Working Papers 14-02, Federal Housing Finance Agency.

    More about this item

    Keywords

    Hong Kong Accounting Standard 40; Event Window; Stock Return.;
    All these keywords.

    JEL classification:

    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting
    • N2 - Economic History - - Financial Markets and Institutions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-08m40002. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John P. Conley (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.