Corporate Disclosures of the Major Sources of Estimation Uncertainties

Australian Accounting Review, Forthcoming

Posted: 25 Nov 2011

See all articles by Diane M. Mayorga

Diane M. Mayorga

UNSW Australia, UNSW Business School

Baljit K. Sidhu

UNSW Australia Business School, School of Accounting

Date Written: November 1, 2011

Abstract

We investigate compliance by the largest 20 Australian listed firms with regulatory requirements to disclose key assumptions and major sources of estimation uncertainties. These relate to accounting estimates that require management’s judgement in measuring the carrying amount of the entity’s assets and liabilities. While we find that firms provide some disclosure, the information is not sufficiently informative to give users meaningful insights. Overall, the level of disclosure falls short of the intentions of the relevant pronouncements. Our findings suggest that additional guidance may be necessary to improve compliance and thus increase the information value that these disclosures contribute to financial reports.

Keywords: Estimation Uncertainty, Accounting Estimates, Disclosure

JEL Classification: M40, M41, M49

Suggested Citation

Mayorga, Diane M. and Sidhu, Baljit K., Corporate Disclosures of the Major Sources of Estimation Uncertainties (November 1, 2011). Australian Accounting Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1963567

Diane M. Mayorga (Contact Author)

UNSW Australia, UNSW Business School ( email )

UNSW Business School
High St
Sydney, NSW 2052
Australia

Baljit K. Sidhu

UNSW Australia Business School, School of Accounting ( email )

Sydney, NSW 2052
Australia

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