Managerial ability and financial statement disaggregation decisions

Dien Giau Bui, Yehning Chen, Yan Shing Chen, Chih Yung Lin*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Scopus citations


Firms with high-ability management teams disclose more disaggregated information in financial statements than other firms after accounting for endogeneity concerns. Investors deem the disaggregated information disclosed by high-ability managers to be more credible. More disaggregated accounting information reduces stock price crash risk and lowers the cost of equity to a greater extent when provided by high-ability managers. Superior managers’ performance pay is positively related to the level of financial statement disaggregation. These results show that high-ability managers and their firms benefit more from providing granular accounting information.

Original languageEnglish
Article number101427
JournalJournal of Empirical Finance
StatePublished - Dec 2023


  • Credibility
  • Disaggregation
  • Financial statements
  • Managerial ability


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