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Accounting Comparability and Corporate Innovative Efficiency

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Accounting Comparability and Corporate Innovative Efficiency. / Chircop, Justin; Collins, Daniel; Hass, Lars Helge et al.
In: The Accounting Review, Vol. 95, No. 4, 01.07.2020, p. 127–151.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Chircop, J, Collins, D, Hass, LH & Nguyen, N 2020, 'Accounting Comparability and Corporate Innovative Efficiency', The Accounting Review, vol. 95, no. 4, pp. 127–151. https://doi.org/10.2308/accr-52609

APA

Chircop, J., Collins, D., Hass, L. H., & Nguyen, N. (2020). Accounting Comparability and Corporate Innovative Efficiency. The Accounting Review, 95(4), 127–151. https://doi.org/10.2308/accr-52609

Vancouver

Chircop J, Collins D, Hass LH, Nguyen N. Accounting Comparability and Corporate Innovative Efficiency. The Accounting Review. 2020 Jul 1;95(4):127–151. Epub 2019 Dec 1. doi: 10.2308/accr-52609

Author

Chircop, Justin ; Collins, Daniel ; Hass, Lars Helge et al. / Accounting Comparability and Corporate Innovative Efficiency. In: The Accounting Review. 2020 ; Vol. 95, No. 4. pp. 127–151.

Bibtex

@article{b23829f2cc2e491ab6b7928cf0b602b1,
title = "Accounting Comparability and Corporate Innovative Efficiency",
abstract = "We predict that a firm's greater accounting comparability with its industry peers facilitates its learning from those peer firms' research and development (R&D) investments, allowing that firm to have greater innovative efficiency. We estimate accounting comparability using pro-forma capitalized R&D earnings that link lagged R&D expenditures to future profitability employing the Almon (1965) distributed lag model. We find that greater accounting comparability leads to enhanced ability to predict future cash flows generated by R&D investments of peer firms. In the cross-section, we observe the relation between accounting comparability and innovative efficiency is stronger if peer firms exhibit higher accounting (accrual) quality and are themselves successful innovators. In sum, this study shows that a shared qualitative characteristic of accounting, namely accounting comparability, is positively associated with innovative efficiency.",
author = "Justin Chircop and Daniel Collins and Hass, {Lars Helge} and Nhat Nguyen",
year = "2020",
month = jul,
day = "1",
doi = "10.2308/accr-52609",
language = "English",
volume = "95",
pages = "127–151",
journal = "The Accounting Review",
issn = "0001-4826",
publisher = "American Accounting Association",
number = "4",

}

RIS

TY - JOUR

T1 - Accounting Comparability and Corporate Innovative Efficiency

AU - Chircop, Justin

AU - Collins, Daniel

AU - Hass, Lars Helge

AU - Nguyen, Nhat

PY - 2020/7/1

Y1 - 2020/7/1

N2 - We predict that a firm's greater accounting comparability with its industry peers facilitates its learning from those peer firms' research and development (R&D) investments, allowing that firm to have greater innovative efficiency. We estimate accounting comparability using pro-forma capitalized R&D earnings that link lagged R&D expenditures to future profitability employing the Almon (1965) distributed lag model. We find that greater accounting comparability leads to enhanced ability to predict future cash flows generated by R&D investments of peer firms. In the cross-section, we observe the relation between accounting comparability and innovative efficiency is stronger if peer firms exhibit higher accounting (accrual) quality and are themselves successful innovators. In sum, this study shows that a shared qualitative characteristic of accounting, namely accounting comparability, is positively associated with innovative efficiency.

AB - We predict that a firm's greater accounting comparability with its industry peers facilitates its learning from those peer firms' research and development (R&D) investments, allowing that firm to have greater innovative efficiency. We estimate accounting comparability using pro-forma capitalized R&D earnings that link lagged R&D expenditures to future profitability employing the Almon (1965) distributed lag model. We find that greater accounting comparability leads to enhanced ability to predict future cash flows generated by R&D investments of peer firms. In the cross-section, we observe the relation between accounting comparability and innovative efficiency is stronger if peer firms exhibit higher accounting (accrual) quality and are themselves successful innovators. In sum, this study shows that a shared qualitative characteristic of accounting, namely accounting comparability, is positively associated with innovative efficiency.

U2 - 10.2308/accr-52609

DO - 10.2308/accr-52609

M3 - Journal article

VL - 95

SP - 127

EP - 151

JO - The Accounting Review

JF - The Accounting Review

SN - 0001-4826

IS - 4

ER -