Change in value relevance of quarterly foreign sales data of U.S. multinational corporations after adopting SFAS 131

  • Mahmud Hossain
Original Paper


This paper investigates the change in value relevance of quarterly foreign sales data of U.S.-based multinational enterprises after adopting Statement of Financial Accounting Standards No. 131 (SFAS 131). First, I examine whether the interim foreign sales data of all sample firms are valued at a higher rate by equity investors after the firms adopt SFAS 131. My empirical findings indicate that for all sample firms the value relevance of quarterly foreign sales data increases after the firms adopt SFAS 131. I then examine whether the valuation consequence of firms that change their geographic segment definition after they adopt SFAS 131—segment change firms—changes after those firms adopt SFAS 131. Based on the empirical results, I conclude that quarterly foreign sales data of segment change firms are priced at a relatively higher rate after SFAS 131 is adopted.


Segment disclosure SFAS 131 Quarterly disclosure Value relevance Geographic segment 

JEL Classifications

F23 G14 M41 



I am grateful to the two anonymous reviewers for valuable suggestions.


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Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  1. 1.Fogelman College of Business and EconomicsThe University of MemphisMemphisUSA

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