DeeganFAT3e PPT Ch11 Ed
Financial Accounting Theory
Craig Deegan
Chapter 11
Reactions of individuals to financial reporting: an examination of behavioural research
Slides written by Craig Deegan
Copyright 2009 McGraw-Hill Australia Pty
11-
Learning objectives
•
In this chapter you will be introduced to:
–
–
–
–
–
how behavioural research differs from capital market research how different accounting-related variables can be manipulated in behavioural research how the results of behavioural research can be of relevance to corporations and the accounting profession for anticipating individual reactions to accounting disclosures how the results of behavioural research can form the basis for developing ways to more efficiently use accounting-related data the limitations of behavioural research
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-2
Introduction to behavioural research
•
Behavioural research examines how individuals react to various accounting disclosures
•
Grounded in behavioural decision theory
•
Goal is to describe actual decision behaviour, evaluate its quality, and develop and test hypotheses of the underlying psychological processes •
Contrast to capital markets research which examines reactions at a market level
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-3
Brunswick Lens Model
•
Used to explain behavioural research
•
Perspectives about the environment are generated
(observed) through a ‘lens’ of imperfect cues
•
Statistical modelling is applied to determine the weighting (importance) of the various cues
(independent variables) to the criterion event of success (dependent variable)
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-4
Brunswick Lens Model (cont.)
•
Right-hand side models how the individual uses cues to make an ultimate decision about the issue under investigation
•
Left-hand
Craig Deegan
Chapter 11
Reactions of individuals to financial reporting: an examination of behavioural research
Slides written by Craig Deegan
Copyright 2009 McGraw-Hill Australia Pty
11-
Learning objectives
•
In this chapter you will be introduced to:
–
–
–
–
–
how behavioural research differs from capital market research how different accounting-related variables can be manipulated in behavioural research how the results of behavioural research can be of relevance to corporations and the accounting profession for anticipating individual reactions to accounting disclosures how the results of behavioural research can form the basis for developing ways to more efficiently use accounting-related data the limitations of behavioural research
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-2
Introduction to behavioural research
•
Behavioural research examines how individuals react to various accounting disclosures
•
Grounded in behavioural decision theory
•
Goal is to describe actual decision behaviour, evaluate its quality, and develop and test hypotheses of the underlying psychological processes •
Contrast to capital markets research which examines reactions at a market level
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-3
Brunswick Lens Model
•
Used to explain behavioural research
•
Perspectives about the environment are generated
(observed) through a ‘lens’ of imperfect cues
•
Statistical modelling is applied to determine the weighting (importance) of the various cues
(independent variables) to the criterion event of success (dependent variable)
Copyright 2009 McGraw-Hill Australia Pty Ltd
PPTs t/a Deegan, Financial Accounting Theory 3e
11-4
Brunswick Lens Model (cont.)
•
Right-hand side models how the individual uses cues to make an ultimate decision about the issue under investigation
•
Left-hand