IAS-19 and The Challenges of Comparability: Multinational Pension Disclosures Across IFRS and US GAAP
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Abstract
Defined benefit pension plans remain among the most complex areas of financial reporting under IAS-19. This study examines whether the removal of the 2007 SEC reconciliation requirement created valuation and forecasting challenges for investors because of differences in pension reporting. A panel of multinational firms was analysed using regression and machine learning methods. PensionBridge, a measure of cross-standard pension reporting gaps, was evaluated alongside pension intensity and firm-level controls. Results from baseline and quantile regressions show that larger PensionBridge values are associated with higher forecast errors, greater forecast dispersion, and increased loan-spread sensitivity. A stronger effect is observed for firms with limited analyst coverage and in jurisdictions with weaker enforcement. Machine learning models confirm non-linear patterns and threshold effects. Event-study estimates indicate negative short-term reactions immediately after 2007, while difference-in-differences (DiD) averages show small positive effects across the full post period, highlighting the distinction between timing and average market responses. The evidence suggests that pension reporting differences under IAS-19 created significant market consequences, and investor adjustment was required over time, and monitoring resources were needed after reconciliation tables were removed.
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