International Financial Reporting Standards and Earnings Quality: The Myth of Voluntary vs. Mandatory Adoption

We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics and that size, leverage, age, bank ownership and ownership concentration influenced the decision to voluntarily adopt IFRS. However, regardless of the decision to voluntarily adopt IFRS, we find that conditional conservatism increased under IFRS for both groups of adopters, while evidence does not suggest an increase in value relevance under IFRS. Results on earnings management in the post-adoption period are mixed. While income smoothing decreases for voluntary but not for mandatory adopters, discretionary accruals only decrease for mandatory but not for voluntary adopters. However, further analyses suggest that the capital market environment and the economic cycle during the adoption period seem to be a more powerful explanation for this evidence than voluntary or mandatory IFRS adoption. Therefore, we conclude that incentives to voluntarily adopt IFRS did not unambiguously dominate accounting standards in determining earnings quality in the case of German firms

Cellular proliferation and migration following a controlled cortical impact in the mouse.

Neurogenesis following neural degeneration has been demonstrated in many models of disease and injury. The present study further examines the early proliferative and migratory response of the brain to a controlled cortical impact (CCI) model of traumatic brain injury. The CCI was centered over the forelimb sensorimotor cortex, unilaterally, in the adult mouse. To examine proliferation, bromo-deoxyuridine (BrdU) was injected i.p. immediately post-injury and on post-injury days 1, 2, and 3. To assess migration, we labeled SVZ cells with inert latex microspheres immediately post-injury. By combining microsphere labeling with BrdU, we determined if migrating cells had gone through the S-phase of the cell cycle after the lesion. In addition, we used a marker of neurogenesis and migration, doublecortin, to further characterize the response of the SVZ to the injury. Lastly, we determined whether subregions of the SVZ respond differentially to injury. The current study demonstrates that 3 days following CCI cellular proliferation is seen around the cortex, in the SVZ, corpus callosum, and subcortical areas anatomically connected to, but not directly damaged by the impact. It delineates that an increase in proliferation occurs in the dorsal-most aspect of the ipsilateral SVZ following impact. Lastly, it demonstrates that proliferating cells migrate from the SVZ to cortical and subcortical structures affected by the injury and that some of these cells are migrating neuroblasts