Market Risk Reporting by the World's Top Banks: Evidence on the Diversity of Reporting Practice and the Implications for Accounting Harmonisation

37 Pages Posted: 22 Jan 2009 Last revised: 29 Jun 2009

See all articles by Margaret Woods

Margaret Woods

Aston Business School

Kevin Dowd

Nottingham University Business School (NUBS)

Christopher Humphrey

University of Manchester - Division of Accounting and Finance

Date Written: November 28, 2008

Abstract

The increasing adoption of international accounting standards and global convergence of accounting regulations is frequently heralded as serving to reduce diversity in financial reporting practice. In a process said to be driven in large part by the interests of international business and global financial markets, one might expect the greatest degree of convergence to be found amongst the world's largest multinational financial corporations.

This paper challenges such claims and presumptions. Its content analysis of longitudinal data for the period 2000-2006 reveals substantial, on going diversity in the market risk disclosure practices, both numerical and narrative, of the world's top-25 banks. The significance of such findings is reinforced by the sheer scale of the banking sector's risk exposures that have been subsequently revealed in the current global financial crisis. The variations in disclosure practices documented in the paper apply both across and within national boundaries, leading to a firm conclusion that, at least in terms of market risk reporting, progress towards international harmonisation remains rather more apparent than real.

Keywords: market risk, risk reporting, world's top banks, accounting harmonisation

JEL Classification: G21, M41, M44, M47, N20

Suggested Citation

Woods, Margaret and Dowd, Kevin and Humphrey, Christopher, Market Risk Reporting by the World's Top Banks: Evidence on the Diversity of Reporting Practice and the Implications for Accounting Harmonisation (November 28, 2008). Available at SSRN: https://ssrn.com/abstract=1308512 or http://dx.doi.org/10.2139/ssrn.1308512

Margaret Woods (Contact Author)

Aston Business School ( email )

Aston Business School
Aston Triangle
Birmingham, B4 7ET
United Kingdom

Kevin Dowd

Nottingham University Business School (NUBS) ( email )

Jubilee Campus
Wollaton Road
Nottingham, NG8 1BB
United Kingdom

Christopher Humphrey

University of Manchester - Division of Accounting and Finance ( email )

Crawford House
Oxford Road
Manchester M13 9PL
United Kingdom

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