The Impact of Research and Development Expenditures on the Value Relevance of Accounting Items

2020 ◽  
pp. 41-67
Author(s):  
Melik Ertuğrul
Keyword(s):  
Research And Development ◽  
Value Relevance ◽  
The Impact

The influence of IFRS mandatory adoption on value relevance of intangible assets in Italy

2020 ◽  
Vol 21 (3) ◽  
pp. 415-436
Author(s):  
Michela Cordazzo ◽  
Paola Rossi
Keyword(s):  
Intellectual Property ◽  
Research And Development ◽  
Stock Prices ◽  
Intangible Assets ◽  
Value Relevance ◽  
Accounting Standards ◽  
Content Type ◽  
Ifrs Adoption ◽  
Start Up ◽  
The Impact

PurposeFollowing the mandatory IFRS adoption in 2005, the Continental European accounting systems changed. This study investigates if it influenced the value relevance of intangible assets in Italy.Design/methodology/approachTo measure the value relevance of intangible assets of non-financial firms listed on Borsa Italiana from 2000 to 2015, this study isolates the impact of several classes of intangible assets on stock prices and then classifies firms according to intangible asset intensity.FindingsGoodwill, intellectual property and other rights, start-up costs or other intangible assets are significantly correlated with stock prices when Italian accounting standards were applied prior to 2005, whereas research and development expenditures are not associated with stock prices. The mandatory IFRS adoption has exerted positive effects only for goodwill and research and development expenditures, and it is negative for start-up costs. Further, when intangible-intensive firms are considered in the post-IFRS adoption period, declining value relevance exists relative to intellectual property and other rights or research and development expenditures; goodwill and other intangible assets increase in value relevance.Research limitations/implicationsThis study is subject to country-specific determinants and firm-specific characteristics. It treats accounting standards as exogenous, and the classification reflects the concentration of intangible assets in an industry. By relying on investors’ assessments of risk, it does not sufficiently explore the risk conveyed by future abnormal earnings and earnings volatility.Practical implicationsThis study offers insights for measuring and reporting intangible assets, by specifying that their value relevance depends on their level and aggregation.Originality/valueThis study investigates the value relevance of intangible assets in the post-IFRS period, in reference to intangible-intensive firms. It also divides intangible assets into several classes to specify the value relevance of goodwill.

The Impact of Different Accounting Reporting Methods on the Informativeness of Research and Development Costs: IFRS Compared to U.S. GAAP

2016 ◽  
Vol 19 (04) ◽  
pp. 1650025 ◽  
Author(s):  
Michael T. Dugan ◽  
John E. McEldowney ◽  
Elizabeth H. Turner ◽  
Clark M. Wheatley
Keyword(s):  
Research And Development ◽  
Information Content ◽  
Direct Effect ◽  
Indirect Effect ◽  
Value Relevance ◽  
Operating Income ◽  
Development Costs ◽  
Before And After ◽  
The Impact

In this paper, we examine the information content and value relevance of research and development (R&D) costs before and after the SEC eliminated the 20-F reconciliation to U.S. GAAP for Foreign Public Issuers (FPIs). Prior to the elimination both FPIs and U.S. firms experienced an increase in the indirect effect of R&D on operating income. After the requirement was eliminated, the direct effect increased for FPIs and the indirect effect decreased. This is in contrast to U.S. firms who experienced a continued increase in the indirect effect. This shift indicates there was a loss of informativeness in the R&D disclosures for FPIs.

Advancing dairy farming profitability through research

2001 ◽  
pp. 17-22
Author(s):  
J.R. Caradus ◽  
D.A. Clark
Keyword(s):  
Research And Development ◽  
Dairy Cow ◽  
Low Cost ◽  
Pasture Management ◽  
Nitrogen Fertiliser ◽  
Grass Endophyte ◽  
Forage Species ◽  
Development Outcomes ◽  
Dairy Cow Nutrition ◽  
The Impact

The New Zealand dairy industry recognises that to remain competitive it must continue to invest in research and development. Outcomes from research have ensured year-round provision of low-cost feed from pasture while improving productivity. Some of these advances, discussed in this paper, include the use of white clover in pasture, understanding the impacts of grass endophyte, improved dairy cow nutrition, the use of alternative forage species and nitrogen fertiliser to improve productivity, demonstration of the impact of days-in-milk on profitability, and the use of feed budgeting and appropriate pasture management. Keywords: dairy, profitability, research and development

Report of the Ad Hoc Subgroup on the Impact of Competition in Contracting on Research and Development

1988 ◽  
Author(s):  
Laurence Storch ◽  
Donald Fraser ◽  
Robert Lunn ◽  
Barbara Glacel ◽  
Naomi J. McAfee
Keyword(s):  
Research And Development ◽  
Ad Hoc ◽  
The Impact

scholarly journals A Study on the Impact of R&D Intensity on Business Performance: Evidence from South Korea

2021 ◽  
Vol 7 (2) ◽  
pp. 135
Author(s):  
Hun Park ◽  
Jun-Hwan Park ◽  
Sujin Lee ◽  
Hyuk Hahn
Keyword(s):  
South Korea ◽  
Research And Development ◽  
Business Performance ◽  
Decision Makers ◽  
The Other ◽  
Research Groups ◽  
Innovative Firms ◽  
The Impact ◽  
Knowledge Services

The role of R&D (research and development) intensity on the effect of knowledge services on the business performance of firms has been discussed by using PLS-SEM and PLS-MGA methods. Research groups were divided into two groups, innovative and non-innovative. Respondents were classified into innovative firms if their R&D intensity was over 3% and vice versa. PLS-SEM and PLS-MGA results were compared for two groups and valuable insights were extracted. For innovative firms, knowledge services seemed to be verified and processed by the decision makers and utilized to achieve their business performance. On the other hand, a large number of non-innovative firms seemed to have a stronger tendency to utilize knowledge services directly for their business without sufficient verification by the decision makers.

THE IMPACT OF RESEARCH AND DEVELOPMENT INVESTMENT ON AGRICULTURAL SECTOR PERFOMANCE IN KENYA

2017 ◽  
Vol 2 (1) ◽  
pp. 34-57
Author(s):  
John Githii Kimani ◽  
Dr. George Ruigu Ruigu
Keyword(s):  
Research And Development ◽  
Agricultural Sector ◽  
Research Policy ◽  
Trade Openness ◽  
Policy And Practice ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
Parsimonious Model ◽  
The Impact

Purpose: The purpose of the study was to assess the impact of research and development investment/expenditure on the agricultural sector performance in Kenya.Methodology: The study took the peoples impact assessment direction. The data for this study was collected from various government agencies such as KARI, ASTI, Kenya Agricultural Sector Data compendium website, FAOSTAT, World Bank among others. Co-integration and error correction modeling methods were used in analyzing the data for this study.Results: Co-integration results for both the parsimonious and non-parsimonious model indicated that that there is a long-run relationship among the variables in the agriculture performance in Kenya. Further, findings in this study indicated that the variables under study were insignificant determinants of the long run Total Factor Productivity of the agricultural sector.  Meanwhile, Trade openness was the only significant determinant of the short run agricultural Total Factor Productivity.Unique Contribution to Policy and Practice: This study recommends the institutionalization of policies aimed at ensuring interaction between the various stakeholders in the agricultural sectors. This interaction will ensure that resources are better allocated to reduce duplication of research and dissemination activities. In addition, greater collaboration among the stakeholders will promote and strengthen the connection between research, policy and the application of research findings. The study further advocates that the government should follow a trade liberazation oriented approach to the agricultural sector as opposed to a trade tightening approach.

scholarly journals Value relevance of accounting data and financial crisis in Europe: an empirical analysis

2012 ◽  
Vol 2 (2) ◽  
pp. 201 ◽  
Author(s):  
Alain Devalle
Keyword(s):  
Financial Crisis ◽  
Positive Impact ◽  
Value Relevance ◽  
Net Income ◽  
Accounting Data ◽  
Book Value ◽  
Crisis Period ◽  
Comprehensive Income ◽  
The Impact ◽  
The Relationship

This paper aims at verifying the relationship between book value and  market value for a four years period (2006-2009) in Europe, under IFRS. In particular, I used value relevance approach to measure whether net income or comprehensive income are more useful to understand the relationship between market data and financial data. Moreover, the paper analyzes the impact of financial crisis on the value relevance of accounting data. The examination period runs from a pre-crisis period (2006-2007) to an in-crisis period (2008-2009). Results shows that comprehensive income is more value relevant than net income. Furthermore, the financial crisis has a positive impact on value relevance.  

Does board independence constrain insider opportunism?

2020 ◽  
pp. 031289622094638
Author(s):  
Dewan Rahman ◽  
Robert Faff ◽  
Barry Oliver
Keyword(s):  
Research And Development ◽  
Insider Trading ◽  
Jel Classification ◽  
Independent Directors ◽  
Board Independence ◽  
Exogenous Shocks ◽  
Sarbanes Oxley ◽  
Trading Restrictions ◽  
The Impact ◽  
Identification Strategy

We examine whether insider opportunism is reduced by board independence. Using a sample of 18,194 firm-year observations over the period 1996–2016, we show that board independence constrains opportunistic insider trading. Our identification strategy uses the Sarbanes–Oxley Act of 2002 (SOX Act) and associated changes to the listing rules of NYSE/NASDAQ as a source of exogenous shocks in board independence. Our results are economically significant as insider opportunism declines by about 10.5%. We find that insider trading restrictions is the channel through which board independence reduces insider opportunism. Our additional analyses show that in competitive and R&D (research and development) intensive firms, the impact of board independence on opportunism is less pronounced. We also find that board independence constrains opportunism only in less complex firms. However, in co-opted boards, independent directors are less effective. Overall, we support the monitoring channel of board independence for reducing insider opportunism. JEL Classification: G14, G34, G40

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