JOURNAL OF ACCOUNTING AND FINANCE
Finite Element Method for Pricing Swing Options under Stochastic Volatility
Author(s): Edward P. C. Kao, Muhu Wang
Citation: Edward P. C. Kao, Muhu Wang, (2018) "Finite Element Method for Pricing Swing Options under Stochastic Volatility ", Journal of Accounting and Finance, Vol. 18, ss. 3, pp. 26-45
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This paper examines whether tax expense and its information content have changed after Canadian firms adopted IFRS in 2011. Inspired by the concept of orthogonalization, this paper proposes a new measure for incremental information content to mitigate the multicollinearity among highly correlated accounting variables. The main analysis and robustness tests show that tax expense and its information content have not changed significantly during the transition to IFRS in Canada, while the average effective tax rate increased by 1.5 percent for the post-IFRS period.