Harmonization of Voluntary Disclosure Practices by Japanese Companies

Abstract

The costs and benefits of harmonization of international accounting and disclosure practices by firms is an important policy issue. This paper investigates the extent of harmonization or convergence of voluntary disclosure practices by Japanese firms since the collapse of Japan's financial 'bubble' of the late 1980's. Convergence or increased harmonization of voluntary disclosure suggests that Japanese firms respond to environmental and market pressures to harmonize reporting practices. Our findings suggest that for our sample of Japanese firms, there was neither more, nor less, harmonization or convergence in selected voluntary disclosure practices over the sample period, although the average level of disclosure did increase.