Library Header Image
LSE Research Online LSE Library Services

The perceived credibility of forward-looking performance disclosures

Athanasakou, Vasiliki E. and Hussainey, Khaled (2014) The perceived credibility of forward-looking performance disclosures. Accounting and Business Research, 44 (3). pp. 227-259. ISSN 0001-4788

PDF - Published Version
Available under License Creative Commons Attribution.

Download (557kB) | Preview

Identification Number: 10.1080/00014788.2013.867403


We investigate the credibility of forward-looking performance disclosures (FLPDs) in the narrative sections of annual reports, as perceived by investors. Our proxy for these disclosures is an index of statements about future performance. We find that companies issue more FLPDs when raising debt or conveying bad news in the financial statements. In the presence of these managerial incentives, investor reliance on FLPDs increases with the quality of earnings reported in the audited financial statements. Our results suggest that firms derive a benefit in terms of higher credibility for their narrative disclosures from having a reputation for high quality earnings.

Item Type: Article
Official URL:
Additional Information: © 2014 The Authors, published by Taylor & Francis
Divisions: Accounting
Subjects: H Social Sciences > HF Commerce > HF5601 Accounting
H Social Sciences > HG Finance
Date Deposited: 04 Mar 2014 11:26
Last Modified: 20 Oct 2021 02:09
Projects: ES/J012394/1
Funders: Economic and Social Research Council

Actions (login required)

View Item View Item


Downloads per month over past year

View more statistics