expected to report the impact of changes expected in subsequent years, especially if they have multi-period impacts. This allows for better long-term decision making. Multi-period disclosure of accounting changes would be useful to investors and other users for example, Investors who are aware that an income-increasing accounting change occurred may revise downward their valuation of the company for at least two reasons. First, investors may view reported earnings as artificially inflated as a result of the accounting change and therefore adjust reported earnings downward to arrive at “value-relevant earnings. Holding constant that all investors receive a reconciliation disclosure in the period of an accounting change, as the number of subsequent periods increases, the valuation judgments of investors who receive a reconciliation disclosure of the change in all subsequent periods diverge from those of investors who receive no disclosure of the change in all subsequent periods. Emett, S. A., & Nelson, M. W. (2017). Reporting accounting changes and their multi-period effects. Accounting, Organizations and Society,57, 52-72. doi:10.1016/j.aos.2017.03.002
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