The Impact of Appraisal Quality on the Voluntary Disclosure of Asset Revaluation

In the wake of the global financial crisis, we compare Korean firms that voluntarily disclosed their revaluation in a timely manner with those that did not. We find that firms are more likely to disclose revaluation when they hire a large, reputable appraisal firm and when they have a large number of revaluation increments. We observe a significantly positive market reaction to the voluntary disclosure of the revaluation results. A positive market reaction is mainly observed for firms that hired a large, reputable appraisal firm, had a large number of revaluation increments, and were under greater financial distress before revaluation.