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 school districts that received federal assistance for disadvantaged students under Title I of the Elementary and Secondary Education Act to publish report cards for each of its schools. 212

The new federal requirements demanded disclosure of more information than was commonly published by districts at that time. School report cards had to disclose students’ achievement on state tests and disaggregate test scores by race, disability status, and English proficiency. They also had to disclose teacher qualifications and show trends in achievement, dropout rates, graduation rates, and percentages of students not tested. 213

The quality of school report cards has increased substantially since the enactment of the No Child Left Behind law, although report cards still fall short of full compliance. 214 By 2004, all fifty states provided scho ol report ca rds and forty-four states disaggregated student achievement data by race and disability as required by 2001 law. However, only fourteen states disaggregated graduation data and provided information regarding the number and percentage of “highly qualified” teachers as required by the law.

At the same time, multiple federal and state reporting requirements created confusion. In 2004, nineteen states had more than one report card per school and sixteen states created special report cards to comply with the requirements of the No Child Left Behind law. 215

One careful study of state-level student performance in 2004 found that the incentives and sanctions associated with accountability systems in education reform had a significant and positive impact on test scores but that school report cards alone had no independent statistically significant effect. 216 In 2006, it was still too early to determine whether school report cards would improve over time and whether they would create incentives for better public education.

TARGETED TRANSPARENCY IN THE INTERNATIONAL CONTEXT Harmonizing Disclosure of Corporate Finances to Reduce Risks to Investors

International rules for corporate financial disclosure evolved slowly in the 1990s as rapid integration of securities markets made compliance with widely varying national rules both costly and confusing for companies and regulators. By 2006, a limited effort by a small group of international accountants to write disclosure rules for companies that sold stock in more than one country had become an unusual instrument of international governance. No treaty or international agreement provided a framework for financial disclosure rules. Instead, private efforts became public law by means of a slow process of government endorsement.

An important date was January 1, 2005, when the European Union (EU) required more than seven thousand public companies headquartered in its twenty-five member countries to foll ow the fina ncial disclos ure rules established by the private International Accounting Standards Board (IASB). 217 Officials of the Bush administration announced that the United States, too, might hand over to the board as early as 2007 financial reporting rule making for foreign listings. 218 Russia, South Africa, Australia, Taiwan, Hong Kong, and India also had plans to adopt the rules made by the international board.

However, the seemingly technical task of harmonizing accounting standards produced difficult political issues from the start, because what financial information was disclosed and how it was disclosed could change markets. Reporting requirements could alter the projects firms chose to undertake, how they compensated employees, how well firms