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Investigating ASX300 firms for the period 2002–2010, we find that the information content of director trading has a negative relationship with post-trade information asymmetry, but a positive relationship with information efficiency. These results are mainly driven by director purchases rather than their sales, and are stronger in non-executive director trading. Our results are robust to the adoption of IFRS in 2005 and the global financial crisis in 2008. These findings back the claims of insider trading proponents, by showing that director trading plays a crucial role in reducing information asymmetry and in improving information efficiency for stock market participants. [ABSTRACT FROM AUTHOR]

We investigate the content, timing and relevance of firms’ narrative disclosure about the effects of IFRS adoption in annual statutory financial statements and firm announcements to the stock exchange for 150 large listed Australian firms in the three-year period surrounding adoption (which occurred from 1 January 2005). We observe communication about changes in financial reports, even when the change relates to accounting rather than economic events. We record more disclosure by firms experiencing an adverse change in earnings, consistent with them being sensitive to signals about future earnings. When economic performance is stronger, firms provide less discussion of the accounting effects of IFRS. We also find the discussion of IFRS impact in both disclosure channels is value–relevant for firms with relatively higher levels of disclosure, providing evidence of the usefulness of transition disclosures. [ABSTRACT FROM AUTHOR]