Analyst Forecast Properties Around IFRS-Based Consolidation: Coverage, Dispersion, and Bias in Morocco

Baroud, Saddek and Tangl, Anita (2026) Analyst Forecast Properties Around IFRS-Based Consolidation: Coverage, Dispersion, and Bias in Morocco. In: FEJLŐDÉSI PÁLYÁK ÉS ÚJ TÖRÉSVONALAK A FENNTARTHATÓSÁGI ÁTMENET IDŐSZAKÁBAN : Nemzetközi tudományos konferencia a Magyar Tudomány Ünnepe alkalmából. Soproni Egyetem Kiadó, Sopron, pp. 363-377. ISBN 9789633345795

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Abstract

This study focuses on whether first-time IFRS-consolidated reporting enhances the financialinformation environment of investment analysts specifically in the context of a frontier marketsetting. Using a panel of 20 Moroccan-listed firms observed annually over 2016–2024, thestudy analyses event-studies based on the first consolidated year (FCY) of each company andits subsequent effects on the dispersion of analysts’ attention, dispersion of forecasts, absoluteerror of forecasts (\|forecast error\|), and biased error of forecasts. Model specifications includefixed effects of the company and the year with sector fixed effects and interactions for eachrespective year. Additionally, the study incorporates clustered standard errors with a firm-clustered grouping variable and minorised variables. The study finds that the number of analystsfollowing the company increases around the first consolidated year of the company; meanwhile,the dispersion of analysts’ attention across analysts and the absolute error of the analysts’forecasts decrease with the average error of the forecasts tending toward zero. Additionally, thestudy finds that the pre-trends on the event-study results are flat. To explain these results basedon the theoretical literature on the IFRS, it could be inferred that financial consolidation improves the disclosure quality of financial reports and modelling ambiguity due to the enhancedgroup-level reporting and the increased notes of the company’s financial condition. The studyconcludes with proposed further investigation into the corrections of the staggered-DiD estimates based on the group complexity of the company and the extent of its involvement withrelated-party transactions.

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