Disclosure indices design: does it make a difference?

Measurement of information disclosed by companies is a complex task. Accounting research usually relies on disclosure indices to obtain a proxy for the information disclosed by companies. However, there is no consensus about the best design for these indices. The purpose of this paper is to investig...

Full description

Saved in:
Bibliographic Details
Published in:Revista de contabilidad 2009-07, Vol.12 (2)
Main Authors: Francisco Bravo Urquiza, Maria Cristina Abad Navarro, Marco Trombetta
Format: Article
Language:English
Subjects:
disclosure indices
Disclosure research
forward-looking information
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Measurement of information disclosed by companies is a complex task. Accounting research usually relies on disclosure indices to obtain a proxy for the information disclosed by companies. However, there is no consensus about the best design for these indices. The purpose of this paper is to investigate if there are significant differences among the indices that are used in disclosure studies. Three indices that measure disclosure of forward-looking information are compared: A “quality index” of a multidimensional nature; a “scope index” designed specifically to measure the scope of information, and a “quantity index” that measures information disclosed exclusively in terms of quantity. Results of the empirical analysis indicate that although the indices are correlated, they have a big impact in the rankings of companies. Evidence against the idea of the irrelevance of the particular index chosen is provided.
ISSN:1138-4891
1988-4672
DOI:10.1016/S1138-4891(09)70008-1