The impact of different accounting reporting methods on the informativeness of research and development costs: IFRS compared to U.S. GAAP

Michael T. Dugan, John E. McEldowney, Elizabeth H. Turner, Clark M. Wheatley

Research output: Contribution to journalArticle

3 Scopus citations


In this paper, we examine the information content and value relevance of research and development (R&D) costs before and after the SEC eliminated the 20-F reconciliation to U.S. GAAP for Foreign Public Issuers (FPIs). Prior to the elimination both FPIs and U.S. firms experienced an increase in the indirect effect of R&D on operating income. After the requirement was eliminated, the direct effect increased for FPIs and the indirect effect decreased. This is in contrast to U.S. firms who experienced a continued increase in the indirect effect. This shift indicates there was a loss of informativeness in the R&D disclosures for FPIs.

Original languageEnglish (US)
Article number1650025
JournalReview of Pacific Basin Financial Markets and Policies
Issue number4
StatePublished - Dec 1 2016



  • Accounting quality
  • IFRS
  • Research & development
  • U.S. GAAP

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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