Home > Research > Publications & Outputs > Accounting choice in measurement and comparability

Research

Electronic data

  • Rast_2024_Panaretou

    Accepted author manuscript, 1.12 MB, PDF document

    Available under license: CC BY: Creative Commons Attribution 4.0 International License

Links

Text available via DOI:

View graph of relations

Accounting choice in measurement and comparability: an examination of the effect of the fair value option

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

E-pub ahead of print

Standard

Accounting choice in measurement and comparability: an examination of the effect of the fair value option. / Guedes Cardoso Fontes, Joana; Panaretou, Argyro; Shakespeare, Catherine.
In: Review of Accounting Studies, 17.02.2025.

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

Harvard

Guedes Cardoso Fontes, J, Panaretou, A & Shakespeare, C 2025, 'Accounting choice in measurement and comparability: an examination of the effect of the fair value option', Review of Accounting Studies. https://doi.org/10.1007/s11142-025-09869-5

APA

Guedes Cardoso Fontes, J., Panaretou, A., & Shakespeare, C. (2025). Accounting choice in measurement and comparability: an examination of the effect of the fair value option. Review of Accounting Studies. Advance online publication. https://doi.org/10.1007/s11142-025-09869-5

Vancouver

Guedes Cardoso Fontes J, Panaretou A, Shakespeare C. Accounting choice in measurement and comparability: an examination of the effect of the fair value option. Review of Accounting Studies. 2025 Feb 17. Epub 2025 Feb 17. doi: 10.1007/s11142-025-09869-5

Author

Guedes Cardoso Fontes, Joana ; Panaretou, Argyro ; Shakespeare, Catherine. / Accounting choice in measurement and comparability : an examination of the effect of the fair value option. In: Review of Accounting Studies. 2025.

Bibtex

@article{bb04fe16ac344b41a2c11c7a722faf4e,
title = "Accounting choice in measurement and comparability: an examination of the effect of the fair value option",
abstract = "The choice between historical cost and fair value measurement is one of the most debated issues among accounting academics and practitioners. We use the election of the fair value option (FVO) to study the effects of entities{\textquoteright} measurement choices on accounting comparability. The FVO enables entities to use different measurement bases for similar assets and liabilities, raising questions about whether the FVO compromises or enhances comparability. Using a sample of US banks, we find that FVO elections increase comparability both across FVO electing banks and between FVO electing banks and banks that never elect the FVO but only if the FVO elections comply with the intent of the standard setters to remedy accounting mismatches. Overall our results suggest that banks elect the FVO to better present their economics, yielding higher comparability.",
author = "{Guedes Cardoso Fontes}, Joana and Argyro Panaretou and Catherine Shakespeare",
year = "2025",
month = feb,
day = "17",
doi = "10.1007/s11142-025-09869-5",
language = "English",
journal = "Review of Accounting Studies",
issn = "1380-6653",
publisher = "Springer New York",

}

RIS

TY - JOUR

T1 - Accounting choice in measurement and comparability

T2 - an examination of the effect of the fair value option

AU - Guedes Cardoso Fontes, Joana

AU - Panaretou, Argyro

AU - Shakespeare, Catherine

PY - 2025/2/17

Y1 - 2025/2/17

N2 - The choice between historical cost and fair value measurement is one of the most debated issues among accounting academics and practitioners. We use the election of the fair value option (FVO) to study the effects of entities’ measurement choices on accounting comparability. The FVO enables entities to use different measurement bases for similar assets and liabilities, raising questions about whether the FVO compromises or enhances comparability. Using a sample of US banks, we find that FVO elections increase comparability both across FVO electing banks and between FVO electing banks and banks that never elect the FVO but only if the FVO elections comply with the intent of the standard setters to remedy accounting mismatches. Overall our results suggest that banks elect the FVO to better present their economics, yielding higher comparability.

AB - The choice between historical cost and fair value measurement is one of the most debated issues among accounting academics and practitioners. We use the election of the fair value option (FVO) to study the effects of entities’ measurement choices on accounting comparability. The FVO enables entities to use different measurement bases for similar assets and liabilities, raising questions about whether the FVO compromises or enhances comparability. Using a sample of US banks, we find that FVO elections increase comparability both across FVO electing banks and between FVO electing banks and banks that never elect the FVO but only if the FVO elections comply with the intent of the standard setters to remedy accounting mismatches. Overall our results suggest that banks elect the FVO to better present their economics, yielding higher comparability.

U2 - 10.1007/s11142-025-09869-5

DO - 10.1007/s11142-025-09869-5

M3 - Journal article

JO - Review of Accounting Studies

JF - Review of Accounting Studies

SN - 1380-6653

ER -