scholarly journals The Relation between Income Smoothing, Earnings Persistence and IFRS Adoption

2018 ◽  
Vol 16 (2) ◽  
pp. 251
Author(s):  
Ana Carolina Kolozsvari ◽  
Marcelo Alvaro Da Silva Macedo
Keyword(s):  
Time Series ◽  
Financial Reporting ◽  
Information Quality ◽  
Income Smoothing ◽  
Earnings Persistence ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Ifrs Adoption

This research approaches the influence of smoothing on persistence, two time-series properties of the same earnings stream, considering the adoption of International Financial Reporting Standards (IFRS), in Brazil. This influence is interesting from the possibility of the disclosure to inform stability to influence the information quality for valuation. The objective was to investigate whether the IFRS adoption modified the smoothing-persistence relation. We inserted dummies in autoregressive models, to identify the influence of smoothing on persistence regarding different accounting environments. The findings show that (i) the IFRS adoption increased the quality of earnings; (ii) the IFRS shifted the role of smoothing, that previously increased and then decreased the persistence; and (iii) the smoothing suppressed the benefits for information quality brought by IFRS adoption. We conclude that IFRS increased the informational level of earnings, evidencing that interferences to mitigate impacts on reported income ceased to increase and started to decrease its usefulness.

scholarly journals The role of Politics and Economics in the International Financial Reporting Standards (IFRS) Adoption

2019 ◽  
Vol 36 (2) ◽  
pp. 407
Author(s):  
Araceli Mora
Keyword(s):  
Financial Reporting ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Los Grupos

La adopción de las NIIF desde 2005 ha conllevado beneficios, pero la investigación también ha demostrado que su efecto no ha sido uniforme en los distintos países debido a las diferencias institucionales y en los incentivos. La teoría contractual ofrece un marco teórico para la investigación de las consecuencias económicas y de los incentivos de los grupos de interés para ejercer presión, pero la investigación sobre la actividad de los políticos para interferir en la contabilidad es escasa. El objetivo de este estudio es mostrar el papel de los gobiernos en la contabilidad. Para ello se muestran los cambios acontecidos en el proceso de adopción de las NIIF en la UE para incrementar la interferencia política en nombre del “interés público”, destacando el caso del sector financiero. Se concluye que todas las partes involucradas deberían comprometerse a buscar el equilibrio entre normas basadas en principios y mecanismos de control para mejorar el proceso de comparabilidad con las NIIF.

Market Reaction to the Adoption of IFRS in Europe

2010 ◽  
Vol 85 (1) ◽  
pp. 31-61 ◽  
Author(s):  
Christopher S. Armstrong ◽  
Mary E. Barth ◽  
Alan D. Jagolinzer ◽  
Edward J. Riedl
Keyword(s):  
Information Asymmetry ◽  
Positive Reaction ◽  
Financial Reporting ◽  
Information Quality ◽  
Reporting Standards ◽  
High Quality ◽  
Market Reactions ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Stock Market Reactions

ABSTRACT: This study examines European stock market reactions to 16 events associated with the adoption of International Financial Reporting Standards (IFRS) in Europe. European IFRS adoption represented a major milestone toward financial reporting convergence yet spurred controversy reaching the highest levels of government. We find an incrementally positive reaction for firms with lower quality pre-adoption information, which is more pronounced for banks, and with higher pre-adoption information asymmetry, consistent with investors expecting net information quality benefits from IFRS adoption. We find an incrementally negative reaction for firms domiciled in code law countries, consistent with investors' concerns over enforcement of IFRS in those countries. Finally, we find a positive reaction to IFRS adoption events for firms with high-quality pre-adoption information, consistent with investors expecting net convergence benefits from IFRS adoption.

scholarly journals Measuring the effect of international financial reporting standards on quality of accounting performance and efficiency of investment decisions

Accounting ◽  
2021 ◽  
pp. 249-256
Author(s):  
Alaa Malo-Alain ◽  
Mahfod Mobarak Aldoseri ◽  
Magdy Abdul Hakim Melegy
Keyword(s):  
Financial Reporting ◽  
Cost Of Capital ◽  
Investment Decisions ◽  
Accounting Conservatism ◽  
Earning Management ◽  
Reporting Standards ◽  
Accounting Performance ◽  
Financial Reporting Standards ◽  
Ifrs Adoption

The purpose of this study is to verify the impact of international financial reporting standards (IFRS) adoption on the quality of accounting performance and efficiency of investment decisions in the Saudi business environment as an emerging economy. In this study, content analysis approach is adopted for examining the annual reports of Saudi companies listed in Saudi stock exchange market during two periods: the pre-adoption of IFRS period during the year of 2016 and the post-adoption of IFRS period during the period 2017-2018. The study uses accounting information, accounting conservatism, earning management as alternative variables of accounting performance quality. In addition to accounting profit quality, liquidity and cost of capital are also used as alternative variables for the efficiency of investment decisions. The study finds that there was a positive impact of IFRS adoption on the quality of accounting performance, since it was positively related to both the qualitative characteristics of information and accounting conservatism, while it was negatively related to earning management. IFRS also improves the efficiency of investment decisions, as it was positively related to both profit quality and liquidity while it was negatively related to cost of capital.

Composition and characteristics of the financial statements elements in accordance with IFRS

2020 ◽  
pp. 36-42
Author(s):  
Mohammad Tariq Jassim
Keyword(s):  
Financial Reporting ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
International Accounting ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Current Trends ◽  
Similarities And Differences ◽  
Qualitative Characteristics

In a market economy, the role of International Financial Reporting Standards is increasing. In order to understand their significance in modern conditions it seems necessary to consider the peculiarities of evolution of IFRS formation. The article reflects actual issues concerning the role and significance of International Accounting and Reporting Standards in modern conditions. The author has defined the necessity of applying International Accounting and Reporting Standards by Russian companies. The article highlights the main elements and users of financial statements prepared on the basis of IFRS, and analyzes the similarities and differences that exist in the formation of financial statements, based on the requirements of IFRS and RAS. The main qualitative characteristics of financial statements are considered in detail. Based on the results of the research, the author has identified current trends in the transition to international financial reporting standards.

scholarly journals Tasks of state-owned enterprises and their impact on accounting and reporting information

2021 ◽  
Vol 2021 (9) ◽  
pp. 99-116
Author(s):  
Ljudmyla LOVINSKA ◽  
◽  
Andrii MAMYSHEV ◽  
Keyword(s):  
Public Sector ◽  
Financial Reporting ◽  
The State ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Market Conditions ◽  
Theoretical Understanding ◽  
Important Place ◽  
Financial Reporting Standards

The purpose of the article is to establish ways to implement the tasks of public sector entities in ensuring responsibility and accountability of state-owned enterprises, taking into account market conditions and the transition to international financial reporting standards (IFRS) in the context of determining the place and role of accounting information. The research methodology is based on the application of dialectical and systematic approaches to scientific knowledge and general theoretical understanding of the problems of functional and accounting-analytical support for the management of state-owned enterprises in the application of IFRS. The results of the analysis of modern tendencies of the organization and functioning of the state-owned enterprises are covered. The importance of public sector entities in the global dimension, as well as the features of the organization, challenges and tasks of state-owned enterprises in market conditions are shown. It is determined that the main tasks to be performed by state-owned enterprises are : provision of certain state services and specific goods, support of the national economy and strategic interests, doing business in a natural monopoly, as well as support of social goals of the state. The specificity of the tasks of state-owned enterprises and their important place in the state economy through the role of a special agent of the government for the implementation of state policy in a particular area is substantiated. A new look at these processes involves increasing the transparency and accountability of businesses, which is closely linked to improving the quality of accounting data on the activities of state-owned enterprises. Based on the results of the study, the algorithm of decisions on determining, assessing and reviewing the value of a state-owned enterprise based on the expression of its social, economic, environmental and tax impacts has been improved. There is a problem of harmonization of methodological support for the preparation of aggregate reports of the general government sector (GGS), which arises due to the existing differences between different sets of standards for financial reporting of GGS sector entities (International Financial Reporting Standards (IFRS) - for public corporations and National provisions (standards) of accounting in the public sector (NP(S)APS) - for all other entities of the GGS sector).

scholarly journals Reporting companies’ performance – in respect of the international financial reporting standards (IFRS)

2013 ◽  
Vol 7 (4-5) ◽  
pp. 107-112 ◽  
Author(s):  
Ildikó Dékán Tamásné Orbán
Keyword(s):  
Financial Reporting ◽  
Evaluation Method ◽  
Great Influence ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Financial Health ◽  
Financial Reporting Standards ◽  
Globalizing World ◽  
Rule System

The role of information became more important due to rapidly changing technical conditions, market and economic regulations in our globalizing world. Several regulations tend to provide the framework for reporting performance and income of the companies, but in different statements performance is inconsistently presented and many kind of evaluation method exist in the practice. These facts led to the demand of properly assess the financial health of an organization, and created a commonly accepted rule-system, which name was International Financial Reporting Standards (IFRS). In this paper I tend to present the statements, definitions and factors, which can have great influence in representing the performance, income of the company in the frame of the IFRS, and reveal the differences between the other accounting regulations (EU directives, Hungarian Accounting Act) in this field.

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