Inflection points in the development of IAS 38

2014 ◽  
Vol 12 (1) ◽  
pp. 62-75
Author(s):  
Nicoleta Maria Ienciu ◽  
Dumitru Matiş
Keyword(s):  
Design Methodology ◽  
Accounting Standards ◽  
Graphical Analysis ◽  
Original Study ◽  
International Accounting ◽  
International Accounting Standards ◽  
Content Type ◽  
Main Research ◽  
Inflection Points ◽  
Accounting Rules

Purpose – This paper aims to identify the main inflexion points recorded into development of international accounting standards, case of IAS 38. Design/methodology/approach – The paper takes the form of a conceptual discussion and graphical analysis. The main research method consisted of identifying reference moments, known as inflection points, in the evolution of accounting rules issued by the International Accounting Standards Board and formulating a general framework of testing inflection points’ theory in the development of IAS 38. Findings – The paper highlights the reference moments recorded in the evolution of IAS 38 through the creation of inflexion points’ theory in the field of accounting regulations. Originality/value – According to the authors’ knowledge, this is an original study whose results have implications into accounting regulations field, as in this area, such a theory has not been applied.

Adoption of IFRS in Japan: challenges and consequences

2015 ◽  
Vol 27 (1) ◽  
pp. 3-27 ◽  
Author(s):  
Noriyuki Tsunogaya ◽  
Andreas Hellmann ◽  
Simone Domenico Scagnelli
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Accounting System ◽  
International Accounting Standards ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Institutional Complementarity ◽  
Accounting Environment ◽  
Social Organizational

Purpose – The purpose of this study is to provide a rigorous and holistic analysis of the main features of the Japanese accounting environment. It also raises issues related to the adoption of International Financial Reporting Standards (IFRS) in Japan. Design/methodology/approach – For the purpose of investigating the Japanese accounting system, this study applies the accounting ecology framework developed by Gernon and Wallace (1995) and provides a content analysis of relevant meetings of the Business Accounting Council of Japan. Findings – The findings of this study provide evidence that it would be problematic to require the adoption of IFRS for all listed companies in Japan. The main reason for this is that the Japanese policymakers and standard-setting bodies follow two objectives: enhancing the international comparability of financial reporting and maintaining institutional complementarity between financial reporting and other infrastructures such as accounting-related laws. Research limitations/implications – This study is relevant for accounting researchers and professionals with an interest in Japanese accounting practices. It is also useful for the International Accounting Standards Board and representatives of countries planning to adopt IFRS in the future. Originality/value – The findings of this study show that contextual issues such as social, organizational and professional environments cannot be ignored in the adoption of IFRS in Japan.

Impact assessment of contemporary international and national accounting standards adoption: evidence from Greek hotels

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Nikolaos Iason Koufodontis ◽  
Stella Zounta ◽  
Maria Papagiouvanni
Keyword(s):  
Decision Making ◽  
Accounting Standards ◽  
Strategic Decision ◽  
International Accounting ◽  
Property Management ◽  
International Accounting Standards ◽  
Legal Form ◽  
Macroeconomic Factors ◽  
Content Type ◽  
Mandatory Adoption

PurposeThis paper aims to offer new insights on how the adoption of contemporary international accounting standards can affect the financial performance of a hotel. It provides significant input for strategic decision making in property management, especially in countries where hotels properties are given a choice between different accounting standards.Design/methodology/approachData was collected from 3-, 4- and 5- star hotels in Greece, through primary research with questionnaires, filled by hotel financial managers. Greece was selected because hotels can choose between national and international accounting standards; therefore, the research could focus on actual factors beyond mandatory adoption.FindingsMicroeconomic factors such as category or legal form of the hotel in combination with other factors can affect the perceived benefits of the selected accounting standards. Macroeconomic factors such as the overall tourism development of the destination also affect the perceived impact.Research limitations/implicationsThe research was targeted at hotel executives with knowledge and participation in decision making regarding accounting standards. This requirement limited the sample since all hotels do not have a financial manager position.Practical implicationsThe new knowledge can be utilized in property management as an element of hospitality strategic planning for improved assessment of anticipated effects resulting from the adoption of specific accounting standards.Originality/valueThe research fills a gap in existing knowledge by introducing elements not previously examined; additionally, it expands previous knowledge from other sectors to hospitality and tourism, while verifying or rejecting past findings.

Accounting for leases – lessons from COVID-19

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Alan Teixeira
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Financial Accounting ◽  
International Accounting Standards ◽  
Reporting Standards ◽  
Financial Accounting Standards Board ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Setting Process

Purpose The International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB) have given relief to lessees in response to the coronavirus (COVID-19) pandemic. However, it is not clear why any relief from the requirements in International Financial Reporting Standards (IFRS) or the Accounting Standards Codification (ASC) should be necessary. The purpose of this paper is to highlight weaknesses in how the IASB and FASB developed their leases Standards, and why those Standards are not robust enough to cope with a shock to the economic system. Design/methodology/approach The COVID-19 relief suspends some features of the leasing requirements rather than changing them. What if other economic or regulatory events cause the same circumstances to arise? Findings Have COVID-19 exposed weaknesses in the leasing standards that should have been avoided when they were developed or is COVID-19 the problem? Originality/value Analysis of actual board discussions and staff papers is unusual and provides insights into the standard-setting process.

An investigation of the level of compliance with international accounting standards (IAS 1) by listed firms in Bahrain Bourse

2016 ◽  
Vol 9 (2) ◽  
pp. 254-276 ◽  
Author(s):  
Fatema Ebrahim Alrawahi ◽  
Adel Mohammed Sarea
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Annual Reports ◽  
International Accounting ◽  
International Accounting Standards ◽  
Content Type ◽  
Listed Firms ◽  
Financial Reporting Standards ◽  
Industry Type ◽  
Regulatory Bodies

Purpose This study aims to investigate the association between seven firm-specific characteristics and the level of mandatory compliance with International Accounting Standards (IAS) 1 by firms listed on Bahrain Bourse. Design/methodology/approach A disclosure index is used to measure the extent of compliance with IAS 1. Each of the 36 sampled firms’ annual reports were examined against the index for the financial year ending December 31, 2013. Findings The results reveal an overall compliance of 83 per cent. Regression results report that only audit firm size, profitability and industry type have a positive and significant association with IAS 1 disclosure requirements. Practical implications This study should be particularly relevant to regulatory bodies in Bahrain for strategizing and encouraging compliance with IAS 1 by listed firms. Originality/value Additionally, the study contributes to financial reporting literature relating to the Gulf Cooperation Council countries, mainly Bahrain. Bahrain is a financial hub, and it is interesting to examine how it presents its financial statements to investors and the degree of its compliance with International Financial Reporting Standards since its adoption in 2007.

Adoption of international accounting standards and performance of emerging capital markets

2016 ◽  
Vol 15 (2) ◽  
pp. 252-272 ◽  
Author(s):  
Karim Mhedhbi ◽  
Daniel Zeghal
Keyword(s):  
Capital Markets ◽  
Accounting Standards ◽  
Policy Implications ◽  
International Accounting ◽  
International Accounting Standards ◽  
Content Type ◽  
Before And After ◽  
Emerging Capital Markets ◽  
International Investors ◽  
And Performance

Purpose The purpose of this paper is to examine empirically the association between the adoption of international accounting standards (IAS/IFRS) and the performance of emerging capital markets. Design/methodology/approach Data related to 31 developing countries with capital markets were used. The authors performed univariate analyses (means comparison before and after the use of IAS/IFRS), as well as multivariate analyses (estimation of models of panel data), to test the hypothetical relations set up in the paper. Findings The results suggest that the performance of emerging capital markets is significantly and positively associated with IAS/IFRS use. They are consistent with several empirical investigations which highlighted the relevance of financial information under IAS/IFRS in emerging capital markets. Practical implications Several organizations and decision-makers including the IASB, governments, capital markets regulators and international investors should find the policy implications of this paper very meaningful. Originality/value To the best of the authors’ knowledge, the relationship between the use of IAS/IFRS and the performance of emerging capital markets based on a group of countries has not yet been explored.

scholarly journals The impact of IFRS 7 on the significance of financial instruments disclosure

2016 ◽  
Vol 29 (3) ◽  
pp. 241-273 ◽  
Author(s):  
Yasean A. Tahat ◽  
Theresa Dunne ◽  
Suzanne Fifield ◽  
David M. Power
Keyword(s):  
Balance Sheet ◽  
Accounting Standards ◽  
Fair Value ◽  
Listed Companies ◽  
International Accounting ◽  
International Accounting Standards ◽  
Financial Instruments ◽  
Content Type ◽  
Ifrs 7 ◽  
The Impact

Purpose The main aim of this paper is to investigate Financial Instruments (FIs) disclosures provided by Jordanian listed companies under International Financial Reporting Standard No. 7 (IFRS 7) as compared to those supplied under International Accounting Standards (IAS) 30/32. Design/methodology/approach A sample of 82 Jordanian listed companies is used in this monograph. A disclosure index checklist was constructed to measure FI information provided by the sample companies. Findings The study finds that a larger number of Jordanian listed companies provided a greater level of FI-related information after IFRS 7 was implemented. Specifically, the sample firms provided 47 per cent of the disclosure index items after implementing IFRS 7 as compared to 30 per cent under IAS 30/32. In addition, the industrial analysis of FI disclosure revealed that the highest level of disclosure was provided by firms in the banking sector over the two periods; these companies disclosed 44 per cent of FI-related items pre-IFRS 7 and 69 per cent of items post-IFRS 7. Moreover, the industrial analysis of FI disclosure pre-and post-implementation of IFRS 7 revealed specific aspects of usefulness. In particular, some components of FI disclosure (Balance Sheet and Fair Value) showed no significant differences within and across sectors post the implementation of IFRS 7, suggesting that the new standard may have enhanced the comparability of such information. Research limitations/implications The results provide timely findings to Jordanian authorities who may be trying to evaluate the current reforms adopted; stringent enforcement mechanisms are needed to ensure full compliance with accounting standards. However, the present investigation was conducted on a single nation (Jordan); the circumstances in Jordan gave rise to the importance of the current study. A cross-country comparative analysis is needed in order to examine the application of IFRS 7 in a developing country context. Practical implications The results of the current study have a number of implications for policymakers. First, they provide a great deal of insight for the International Accounting Standards Board about the relevance of its standards to countries outside the Western context. In addition, the findings provide valuable insights for policymakers in Jordan who are concerned about the implications of mandatory disclosures. Originality/value The analysis of FI disclosure in developing countries in general, and in Jordan in particular has been overlooked by the extant literature and therefore this study is the first of its kind to examine this research issue for a sample of Jordanian firms.

The relevance of financial and economic informational environment: evidence from South Asian markets

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Usman Arshad ◽  
Fahad Najeeb Khan ◽  
Muhammad Ishfaq ◽  
Muhammad Nadir Shabbir ◽  
Syed Mehmood Raza Shah
Keyword(s):  
Stock Returns ◽  
South Asian ◽  
Stock Return ◽  
Estimation Error ◽  
Accounting Standards ◽  
International Accounting ◽  
International Accounting Standards ◽  
Momentum Strategy ◽  
Content Type ◽  
Informational Environment

PurposeThis study aims to explore the firm's specific, opacity and economy-specific variables to explain the variation in South Asian market returns and indicate that how the difference in adoption of accounting standards refers to the effect of the movement in stock returns.Design/methodology/approachFollowing the scope of the study, factor analysis, fixed effect, Driscoll and Kraay standard errors (DKSE) and Panel Corrected standard error (PCSE) models have been inducted to determine the influence of firm-specific, opacity and economy-specific variables on stock returns. The sample of study comprises 1,885 firms from five countries located in the South Asia region with the period 2005–2018. To ensure the reliability of data, firm-specific data have been collected from DataStream International, while an international country risk guide was used to compile the data for economy-specific variables.FindingsThis study concluded that firm-specific variables showed a consistent and significant association with stock return except for beta, accrual and momentum while earning aggressiveness was the only factor in opacity measure to capture the variation in stock return. The implementation of international accounting standards seemed to be significant and proves to be helpful to enhance the quality of accounting information.Research limitations/implicationsThe limitations of this study comprised the estimation error by avoiding the firm's observations with negative equity in case of earning opacity and majority (more than 50%) of the observation belongs to a single market as India out of final sample which leads to having biasedness in findings.Practical implicationsThis study helps the investors to consider the firms with smaller market capitalization and lower book to market ratio and avoid the momentum strategy under firm specific factors. Moreover, earning aggressiveness under opacity domain capture the variation in stock return and must be considered while investing funds.Originality/valueThe influence of adoption of international accounting standards along with firm and economy specific variable in South Asian Equity Markets return was the major contribution. Moreover, the inclusion of DKSE and PCSE models to examine the relevance of the financial and economic informational environment was also considered as a part of major contribution of this study.

The dynamics of regional and global multinationals, 1999-2008

2014 ◽  
Vol 22 (2) ◽  
pp. 108-117 ◽  
Author(s):  
Chang Hoon Oh ◽  
Alan M. Rugman†
Keyword(s):  
Longitudinal Data ◽  
Design Methodology ◽  
Accounting Standards ◽  
Fortune 500 ◽  
Annual Reports ◽  
International Accounting Standards ◽  
Content Type ◽  
Definition Of ◽  
Total Sales ◽  
Home Region

Purpose – This paper aims to analyze regional versus global activities of large firms. We assemble longitudinal data over the 1999-2008 period. Design/methodology/approach – Sales and assets data for the Fortune 500 firms from 1999-2008 were compiled from annual reports of the firms, by triad region. The definition of the triad regions is based on international accounting standards. The classifications of firms are based upon the new metric of regional-to-total sales rather than the traditional metric of foreign-to-total sales. Findings – In an extension of the original study of Rugman and Verbeke (2004), no trend toward globalization is found, as nearly 80 per cent of the world’s largest firms are classified as home-region oriented, and only 4 per cent are classified as global. Only a few firms change classifications over the ten-year period. Overall, the world’s largest firms average 70 per cent of their sales and 72 per cent of their assets in their home region of the triad. Originality/value – This paper is the first one to use longitudinal data in the analysis of regional versus global firms, with ten years of data on the regional sales and assets of the world’s 500 largest firms.

scholarly journals The Impending Demise Of LIFO: History, Threats, Implications, And Potential Remedies

2012 ◽  
Vol 28 (4) ◽  
pp. 645 ◽  
Author(s):  
Brian W. Carpenter ◽  
Douglas M. Boyle ◽  
Yi Ren
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Federal Budget ◽  
International Accounting ◽  
International Accounting Standards ◽  
Accounting Practice ◽  
Deficit Reduction ◽  
History Of ◽  
Accounting Rules ◽  
Global Harmonization

Since its approval by congress in 1939, the last-in-last-out (LIFO) inventory cost flow assumption has historically been utilized by a significant portion of U.S. companies for both tax and financial reporting purposes. However, despite its extensive use and wide acceptance in practice, the LIFO inventory method is currently endangered by two powerful movements that make its future existence far from certain. The first of these movements is the ongoing convergence of U.S. and international accounting standards. Whether future global harmonization of accounting practice come from continued convergence or outright adoption of international accounting standards, this harmonization poses a threat to the continued use of LIFO since LIFO is prohibited under international accounting rules. The second movement is grounded in governmental attempts to lessen the current federal budget deficit. The elimination of LIFO has been targeted as a way of reducing the deficit within the Obama administrations deficit reduction efforts. The momentum of these two threats to LIFO makes the topic of LIFOs future ripe for discussion. This study discusses the history of LIFO, illuminates the current threats the method faces, and outlines the most common remedies that have been proposed to mitigate the financial impact faced by companies that will be negatively affected by any such elimination of the method.

scholarly journals The impact of conservatism and secrecy on the IFRS interpretation: the case of Tunisia and Egypt

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jihen Eljammi Ayadi ◽  
Salma Damak ◽  
Khaled Hussainey
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Arab Countries ◽  
International Accounting ◽  
International Accounting Standards ◽  
North African ◽  
Content Type ◽  
Accounting Judgments ◽  
The Impact ◽  
Cultural Effect

Purpose The effect of culture, through the accounting values of conservatism and secrecy, on accounting judgments is an area of research extensively studied in developed countries. However, little research has focused on this issue in developing countries, specifically Arab countries. Thus, this study aims to fill this gap by investigating the impact of the combined effect of the culture/accounting dimensions on the interpretation of the probability expressions used in the international accounting standards/international financial reporting standards (IFRSs) in two North African/Arab countries: Tunisia and Egypt. Design/methodology/approach In the first place, this study determines Hofstede’s cultural index scores for Tunisia, ignored in his original model and updates those related to Egypt, which provides a more relevant understanding of the cultural effect. Then, the study relies on the Hofstede/Gray cultural accounting model to examine the extent to which the accounting values of conservatism and secrecy may affect the recognition of the increase and the decrease of income and the disclosure of this information in the financial statements by postgraduate accounting student in both countries. Findings The results provide evidence of the generalizability of Gray’s conservatism hypothesis in the North African/Arab countries (i.e. Tunisia and Egypt), at least in the context of income recognition. Moreover, the findings demonstrate that culture, through its influence on the accounting value of secrecy, affects the interpretation of probability expressions used in the IFRSs to establish disclosures. Research limitations/implications This study calls for more attention from the standard setters to provide further guidance related to the consistent and accurate numerical value that needs to be assigned to the probability expressions to reduce the ambiguity related to their interpretation. The international accounting standards board (IASB) should pay greater attention to the use of vague probability expressions in developing the IFRSs to promote the true comparability of financial reporting worldwide. Like with any research, this study implies certain limitations specifically related to the sample selection, a sample size, which may affect the generalizability of the results. Thus, future research may rely on a larger sample combining and cover other cultural areas. Practical implications The results of this study may give insights into the practical issues faced by the accounting practitioners and which are related to the interpretation and the application of the IFRS including probability expressions. This may trigger their attention toward this issue to reduce the occurrence of these expressions in the revised and newly released standards to guarantee homogeneous financial reporting practices across countries and enhance the IASB’s objective of international accounting harmonization. Originality/value This study might be the first one that investigates the issue of the IFRS interpretation in two North African and Arab countries: Tunisia and Egypt. It also provides an original investigation of the cultural effect on accounting judgments based on the actualized Hofstede’s cultural indexes, especially for Tunisia which is ignored in the original country classification.

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