Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1005259 | The International Journal of Accounting | 2010 | 33 Pages |
Abstract
The usefulness of segment reporting is grounded on the presumption of diversities of returns and risks across reported segments. We examine the effect of country-specific factors, reporting incentives, and choices on an ANOVA-based measure of cross-segment diversities (CSD) in risk and returns for a sample of Japanese and U.S. multi-segment firms. We find that, in contrast to our expectations, Japanese firms exhibit greater CSD than U.S. firms. Moreover, we find that in both countries CSD is driven especially by reporting incentives associated with profitability and foreign sales, but not by proprietary costs. Further, the manager's choice of the number of reported segments is an important factor affecting CSD.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Accounting
Authors
Pontus Troberg, Juha Kinnunen, Harri J. Seppänen,