Date of Award


Degree Name

Doctor of Philosophy


Theses & dissertations (College of Business)


Richard Francis


This dissertation investigates the impact of the proposed format of financial statements from the International Accounting Standard Board (IASB) and the Financial Accounting Standard Board (FASB) on investors' decisions. In particular, the research question of this study is whether the proposed format reduces the bias from the disposition effect. In 2008, the FASB in conjunction with the IASB published an exposure draft to modify the presentation of financial statements. The proposed format does not change the content of the financial information; it only modifies how information is presented in the financial statements. In other words, recognition of assets, liabilities, revenues, expenses, and stockholders' equity remains the same but these financial statement elements are now grouped differently in the financial statements. The main goal for this proposed format is to improve the usefulness of the financial statements which will help users of the financial statements to make better decisions. Investors are among the users of the financial statements and they have a particular goal, to decide whether or not to invest in a company's stock. However, investors, as decision-makers, are susceptible to biases. The Disposition Effect is an identified bias of investors that results in the sale winning stock too early and the holding of losing stock too long. Judgment and decision making research has found that the format in which information is presented could help individuals to improve the efficacy of their decisions. Whether the proposed format of financial statements helps investors in their decision-making process is an important empirical question for the accounting profession, researchers, and investors. In this study, an experiment is conducted to test for the disposition effect and for the effect of the format of the financial statements in reducing the bias from the disposition effect.




Received from ProQuest

File Size

68 pages

File Format


Rights Holder

Francisco Villanueva