Year: 2014
Type: article
Abstract: Risk disclosure is generally regarded as crucial in order for investors to make informed decisions in the resource allocation process. Our study is the first to empirically investigate the value-relevance of corporate risk disclosure. We focus on the disclosure of foreign exchange (FX) risk, which is an activity notorious for its lack of transparency. Our empirical analysis involves a FX risk disclosure index for a sample of 114 Swedish derivative users. Contrary to expectations our results suggest that, holding the level of derivative usage constant, firm value decreases in the level of risk disclosure.
Author: Jankensgård, Håkan
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W167508409