The Role of Financial Reporting in Resolving Uncertainty about Corporate Investment Opportunities

24 Pages Posted: 8 Aug 2019

See all articles by Elia Ferracuti

Elia Ferracuti

Duke University - Fuqua School of Business

Stephen Stubben

University of Utah

Date Written: August 6, 2019

Abstract

This discussion of the survey of the literature on financial reporting and corporate investment by Roychowdhury et al. (2019) focuses on an area in this literature that has received less attention — how financial reporting helps managers allocate capital across investment opportunities within their firms in the presence of uncertainty. We discuss the theory on investment under uncertainty and offer suggestions for future research.

Keywords: financial reporting, corporate investment, uncertainty, information asymmetry

JEL Classification: M41, G31

Suggested Citation

Ferracuti, Elia and Stubben, Stephen, The Role of Financial Reporting in Resolving Uncertainty about Corporate Investment Opportunities (August 6, 2019). Journal of Accounting & Economics (JAE), Vol. 68, No. 2-3, 2019, Available at SSRN: https://ssrn.com/abstract=3432772 or http://dx.doi.org/10.2139/ssrn.3432772

Elia Ferracuti

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States
919-660-1974 (Phone)

Stephen Stubben (Contact Author)

University of Utah ( email )

1655 E. Campus Center
Salt Lake City, UT 84112
United States

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