A Review of Derivatives Research in Accounting and Suggestions for Future Work

Journal of Accounting Literature, Forthcoming

49 Pages Posted: 14 Feb 2019

See all articles by John L. Campbell

John L. Campbell

University of Georgia - J.M. Tull School of Accounting

Landon M. Mauler

Florida State University - Department of Accounting

Spencer Pierce

Florida State University - College of Business

Date Written: February 5, 2019

Abstract

This paper provides a review of research on financial derivatives, with an emphasis on and comprehensive coverage of research published in 15 top accounting journals from 1996-2017. We begin with some brief institutional details about derivatives and then summarize studies explaining when and why firms use derivatives. We then discuss the evolution of the accounting rules related to derivatives (and associated disclosure requirements) and studies that examine changes in these requirements over the years. Next, we review the literature that examines the consequences of firms’ derivative use to various capital market participants (i.e., managers, analysts, investors, boards of directors, etc.), with an emphasis on the role that the accounting and disclosure rules play in such consequences. Finally, we discuss the importance of industry affiliation on firms’ derivative use and the role that industry affiliation plays in derivatives research. Overall, our review suggests that, perhaps due to their inherent complexity and data limitations, derivatives are relatively understudied in accounting, and we highlight several areas where future research is needed.

Keywords: Derivatives; Hedging; Hedge Accounting; Risk Management

JEL Classification: M40; M41; G23; G32

Suggested Citation

Campbell, John L. and Mauler, Landon M. and Pierce, Spencer, A Review of Derivatives Research in Accounting and Suggestions for Future Work (February 5, 2019). Journal of Accounting Literature, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3329321

John L. Campbell

University of Georgia - J.M. Tull School of Accounting ( email )

Athens, GA 30602
United States
706.542.3595 (Phone)
706.542.3630 (Fax)

Landon M. Mauler (Contact Author)

Florida State University - Department of Accounting ( email )

Tallahasse, FL 32306
United States

Spencer Pierce

Florida State University - College of Business ( email )

423 Rovetta Business Building
Tallahassee, FL 32306-1110
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
506
Abstract Views
1,924
rank
78,262
PlumX Metrics