This study examines the effect of a security regulation that occurs simultaneously with International Financial Reporting Standards (IFRS) adoption on the information content of earnings announcements in Italy. To identify the effect of this regulation, we use a treatment and a control sample of IFRS countries that vary in the adoption of the security regulation, but are similar along a set of accounting and institutional dimensions (Italy versus France, Belgium, and Portugal). We find that the increase in information content of earnings announcements is more pronounced in Italy (treatment sample). Further, we analyze non-earnings disclosures using 2106 earnings announcements and find that the inclusion of IFRS-based detailed financial statements in earnings announcements contributes to the increased informativeness of IFRS earnings announcements. Our results provide support to the notion that regulatory changes concurrent with IFRS adoption are necessary to yield capital-market benefits.
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