This study aims to examine the relation between firm complexity and the disclosure of non-GAAP earnings.
Using a comprehensive panel data set of 23,162 firm-year observations from 2003 to 2020, this study uses multivariate regression analyses to assess the relation between firm complexity and non-GAAP reporting practices.
The results show that firm complexity is significantly and positively associated with the likelihood of reporting non-GAAP earnings.
This study contributes to the literature on voluntary disclosure and earnings quality by documenting a significant link between firm complexity and non-GAAP reporting behavior. Unlike prior studies that focus primarily on managerial incentives, this study identifies firm complexity as a structural factor influencing disclosure strategies.
