Corporate Venture Capital, Disclosure, and Financial Reporting

47 Pages Posted: 3 Jan 2018 Last revised: 3 Dec 2019

See all articles by Sophia Hamm

Sophia Hamm

Tulane University - A.B. Freeman School of Business

Michael J. Jung

University of Delaware - Accounting & MIS

Min Park

University of Kansas - Accounting and Information Systems Area

Date Written: December 2, 2019

Abstract

We examine firms’ corporate venture capital (CVC) investing activities from a disclosure and financial reporting perspective. The CVC industry has matured to become a driving force for innovation in today’s corporate landscape, yet there is very little research from accounting scholars. We document the type of details that firms provide about their CVC activities, as well as show that they tend to disclose fewer details when they invest in industries outside their own core business. We also document that firms with a CVC program, relative to similar firms without a CVC program, tend to make more future acquisitions and report an increased number of product segments but are not more likely to have future write-offs of goodwill and intangible assets. Our findings suggest firms with a CVC program have more awareness of and access to acquirable technologies and that CVC investing has a positive impact on firms’ future financial reporting.

Keywords: Corporate venture capital, voluntary disclosure, acquisitions, financial reporting

JEL Classification: M41, G11, G24, G32, G34

Suggested Citation

Hamm, Sophia and Jung, Michael J. and Park, Min, Corporate Venture Capital, Disclosure, and Financial Reporting (December 2, 2019). Available at SSRN: https://ssrn.com/abstract=3090797 or http://dx.doi.org/10.2139/ssrn.3090797

Sophia Hamm

Tulane University - A.B. Freeman School of Business ( email )

7 McAlister Drive
New Orleans, LA 70118
United States

Michael J. Jung (Contact Author)

University of Delaware - Accounting & MIS ( email )

Alfred Lerner College of Business and Economics
Newark, DE 19716
United States

Min Park

University of Kansas - Accounting and Information Systems Area ( email )

1654 Naismith Drive
Lawrence, KS 66045
United States

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