Transnational Equity Analysis -- Contents -- Acknowledgements -- 1 Introduction -- 1.1 Aims and scope of the book -- 1.2 Outline of the book -- 1.3 References -- 2 The Internationalisation of Equity Markets and Growth in Institutional Investment -- 2.1 Introduction -- 2.2 The growth in trade of foreign securities -- 2.3 Determinants of the internationalisation of equity markets -- 2.3.1 Capital demand-side factors -- 2.3.2 Capital supply-side factors -- 2.4 The growth in institutional investment -- 2.4.1 The importance of institutional investment -- 2.4.2 The role of fund managers and investment analysts -- 2.5 Summary -- 2.6 References -- 3 International Accounting Diversity and the Harmonisation of International Accounting -- 3.1 Introduction -- 3.2 Causes of international accounting differences -- 3.2.1 Business ownership and financing -- 3.2.2 Legal systems -- 3.2.3 Taxation -- 3.2.4 The accounting profession -- 3.2.5 Consolidation of determinants of international accounting differences -- 3.2.6 The classification of accounting systems -- 3.3 The effects of international accounting diversity on reported figures -- 3.3.1 Example of US/German GAAP differences: BASF -- 3.4 The effects of international accounting differences on stock markets -- 3.5 The international harmonisation of accounting -- 3.5.1 The rationale for international accounting harmonisation -- 3.5.2 Analysts' and investors' participation in international accounting standard setting -- 3.6 Summary -- 3.7 References -- 4 Equity Analysis Techniques: Theory and Evidence -- 4.1 Introduction -- 4.2 The theory of equity valuation -- 4.3 Equity analysis techniques used by analysts and fund managers -- 4.3.1 Fundamental analysis -- 4.3.2 Technical analysis -- 4.3.3 Beta analysis -- 4.3.4 Economic Value Added -- 4.3.5 Top-down analysis.

4.4 The Efficient Markets Hypothesis and equity analysis techniques -- 4.5 Existing empirical evidence on transnational equity analysis -- 4.6 Summary -- 4.7 References -- 5 Information Sources Used in Equity Analysis -- 5.1 Introduction -- 5.2 The usefulness of annual reports and accounting information -- 5.2.1 The theoretical case for the relevance of accounting information -- 5.2.2 Empirical evidence on the use of accounting information in domestic equity analysis -- 5.2.3 Annual reports and the Efficient Markets Hypothesis -- 5.3 Direct company contact as an information source -- 5.4 International evidence on information sources used in domestic equity analysis -- 5.5 Existing empirical evidence on transnational information sources -- 5.5.1 Survey-based research -- 5.5.2 Market-based evidence on transnational equity analysis -- 5.6 Summary -- 5.7 References -- 6 Methodology -- 6.1 Introduction -- 6.2 Data collection -- 6.2.1 The questionnaire survey -- 6.2.2 Semi-structured interviews -- 6.3 Analysis of the data -- 6.3.1 Questionnaire data -- 6.3.2 Analysis of the interview data -- 6.4 Summary -- 6.5 References -- 7 Transnational Equity Appraisal Techniques -- 7.1 Introduction -- 7.2 Background of respondents -- 7.2.1 Sample composition -- 7.2.2 Number of companies analysed -- 7.2.3 Countries analysed -- 7.2.4 Analyst and fund manager specialisation -- 7.3 Equity analysis techniques used -- 7.3.1 Overall usefulness of analysis techniques -- 7.4 Comparison of domestic and transnational analysis techniques -- 7.4.1 International variation in transnational analysis techniques -- 7.5 Differences between transnational analysts and fund managers -- 7.6 Transnational analysis techniques: a focus on fundamental analysis -- 7.7 Discussion and conclusions -- 7.8 References -- 8 Transnational Information Sources -- 8.1 Introduction.

8.2 Domestic and transnational information sources -- 8.2.1 Domestic equity analysis -- 8.2.2 Transnational equity analysis -- 8.2.3 International variation in transnational information sources -- 8.3 Differences between transnational analysts and fund managers -- 8.4 The role of accounting information in transnational analysis -- 8.4.1 Number of annual reports analysed -- 8.4.2 Versions of the annual report used in foreign company analysis -- 8.4.3 The usefulness of components of annual reports -- 8.4.4 Usefulness of components of transnational annual reports: differences between analysts and fund managers -- 8.5 Company contacts: uses and limitations -- 8.6 The role of local analysts -- 8.6.1 Information asymmetries as a cause of reliance on local analysts -- 8.6.2 Regional variation -- 8.7 Discussion and conclusions -- 8.8 References -- 9 Views of International Accounting Diversity and Harmonisation -- 9.1 Introduction -- 9.2 The effects of international accounting differences on investment decisions -- 9.2.1 Differences between analysts and fund managers -- 9.2.2 International variation in the effects of international accounting differences -- 9.2.3 Accounting standards and the cost of capital -- 9.3 Views on the international harmonisation of accounting -- 9.3.1 Differences between analysts and fund managers -- 9.3.2 Reasons for support for harmonisation -- 9.4 Discussion and conclusions -- 9.5 References -- 10 Overview and Conclusions -- 10.1 Motivation for the book -- 10.2 Summary of findings and implications -- 10.2.1 Equity analysis techniques -- 10.2.2 Transnational information sources -- 10.2.3 Harmonisation and international accounting differences -- 10.2.4 Limitations of the empirical study -- 10.3 Concluding remarks -- 10.4 References -- Appendix -- Details of interview respondents -- Index.