The Use Of Accounting Information Before And After The Award Of The MFOAs Certificate Of Conformance

Abstract

This study examines whether the Municipal Finance Officers Associations Certificate of Conformance (CC) provides an effective signal to financial statement users of cities financial reporting quality. Bond ratings were modeled prior to and subsequent to the award of the CC. The model using accounting data subsequent to the ward of the CC had a higher rate of classificatory accuracy (55.6%) than the model using accounting data prior to the award of the CC (50.6%). However, the difference in classificatory accuracy between the two models was not statistically significant.