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Advances in Accounting, incorporating Advances in International Accounting 29 (2013) 134–153

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Advances in Accounting, incorporating Advances in International Accounting

journal homepage: www.elsevier.com/locate/adiac

A content analysis of the comment letters to the FASB and IASB: Accounting for contingencies

Anthony D. Holder a,⁎, Khondkar E. Karim b, 1, Karen Jingrong Lin b, c, 2, Maef Woods d, 3

a

College of Business and Innovation, University of Toledo, Toledo, OH 43606-3390, United States Manning School of Business, University of Massachusetts Lowell, Lowell, MA 01854, United States Sun Yat-Sen University, China d School of Business Administration, Wayne State University, Detroit, MI 48202, United States

b c

a r t i c l e

Keywords: Comment letters Convergence Content analysis Contingent liabilities

i n f o

a b s t r a c t

In this study, we read and analyze 369 comment letters written in response to the IASB's Exposure Draft (ED) of Proposed Amendments to IAS 37 and the FASB's Exposure Draft of Proposed Amendments to FASB Statement No. 5. We also examine how responses to the IASB ED are affected by whether or not the use of IFRS is mandated or permitted by the respondent's country. Although responses were overwhelmingly unfavorable to both EDs, more support was shown for the IASB's proposal to eliminate the probability recognition criterion than for the FASB's proposal to amend the U.S. GAAP disclosure rules. Users responding to the FASB ED provided significantly more intense support than corporate preparers, financial preparers, and legal practitioners. Significantly more respondents to the IASB ED were from countries required or permitted to use IFRS than from countries required to report under their national GAAP. In addition, constituents required or permitted to use IFRS were significantly more likely to express an unfavorable response to the ED and to cite relevance to support their...