Lobbying of the IASB: An Empirical Investigation

2011 ◽  
Vol 10 (2) ◽  
pp. 57-75 ◽  
Author(s):  
Thomas Bowe Hansen
Keyword(s):  
Capital Market ◽  
Empirical Investigation ◽  
Home Country ◽  
Accounting Standards ◽  
Recent Change ◽  
Data Availability ◽  
Board Members ◽  
International Accounting Standards ◽  
The Impact ◽  
The U.S

ABSTRACT This paper provides evidence on how the International Accounting Standards Board (IASB) generates accounting standards in the presence of lobbyists with differing preferences. I develop hypotheses regarding the associations between attributes of lobbyists and their lobbying activity, and their lobbying success. I find that lobbying success is positively related to the ability of the lobbyist to provide information to the IASB; however, this success is dependent on the credibility of the lobbyist. I also find evidence that lobbying success is associated with the impact that the lobbyists have on the viability of the IASB, measured by their financial contributions and the size of the capital market in their home country. However, this association is not present when I look only at cases where lobbyists disagree with IASB proposal drafts. This evidence is useful in evaluating the U.S. Securities and Exchange Commission's (SEC) recent considerations regarding the adoption of IFRS by the U.S., as well as the recent change in the structure of the IASB that requires a defined geographic mix of board members by the year 2012. Data Availability: All data are publicly available from sources indicated in the paper.

Beyond Financial Reporting. Integrated Reporting and its determinants: Evidence from the context of European state-owned enterprises

2019 ◽  
pp. 43-72
Author(s):  
Giuseppe Nicolò ◽  
Gianluca Zanellato ◽  
Francesca Manes-Rossi ◽  
Adriana Tiron-Tudor
Keyword(s):  
Financial Reporting ◽  
Empirical Investigation ◽  
Gender Diversity ◽  
Accounting Standards ◽  
International Accounting Standards ◽  
Integrated Reporting ◽  
Financial Reports ◽  
The Public ◽  
Explanatory Factors ◽  
Board Gender Diversity

Integrated reporting (IR), which aims to overcome the limitations of both tradi-tional financial and stand-alone non-financial reports, has gained momentum as a single comprehensive tool merging financial and non-financial information. Initially conceived for private sector entities, IR is also establishing itself in the public sector context as a vehicle for transparency and accountability. This research offers an empirical investigation of IR practices in the State-Owned Enterprises (SOEs) context. More specifically, the paper investigates the levels of disclosure provided through IR by a sample of 34 European SOEs and explores the effects of potential explanatory factors. The results indicate a fair level of IR disclosure and a trend of reporting information already requested under international accounting standards. The findings also highlight that industry (basic materials and financials) and size positively influence the level of IR disclosure in a particularly strong way, while governance features (board size and board gender diversity) and the provision of external assurance do not exert any impact.

scholarly journals A literature review on the impact of IAS/IFRS and regulations on quality of financial reporting

2016 ◽  
Vol 6 (4) ◽  
pp. 102-114 ◽  
Author(s):  
Newman Wadesango ◽  
Edmore Tasa ◽  
Khazamula Milondzo ◽  
Ongayi Vongai Wadesango
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Reporting Quality ◽  
Financial Statements ◽  
Conclusive Evidence ◽  
Financial Reporting Quality ◽  
International Accounting Standards ◽  
Ifrs Adoption ◽  
The Impact

The International Accounting Standards Board (IASB) in its objectives and preamble, presume that IFRS adoption and perceived compliance to regulatory framework is associated with increased financial reporting quality. Based on these assumptions, this desktop study reviewed several documents to determine whether the IFRS adoption has led to increased financial reporting quality in Zimbabwe. The researchers reviewed literature on how the IAS/IFRS and regulations affect the financial reporting quality of listed companies. The factors around IFRS adoption were identified (mandatory, voluntary and convergence) and discussed in relation to the financial reporting quality. Evidence from previous studies conducted in line with this same issue shows that there is no conclusive evidence on how IFRS and regulations affect the financial reporting quality. Issues to be addressed in further studies include the importance of financial statements prepared under IFRS framework and the importance of compliance with accounting and auditing requirements.

scholarly journals The adoption of IFRS in publicly listed enterprises of high and medium capitalization and the impact of the size of the audit firm in Greece

2014 ◽  
Vol 11 (4) ◽  
pp. 707-716 ◽  
Author(s):  
Michail Pazarskis ◽  
Andreas Koutoupis ◽  
George Drogalas ◽  
Konstantinos Tsakiris
Keyword(s):  
Stock Exchange ◽  
Accounting Standards ◽  
Financial Statements ◽  
International Accounting Standards ◽  
Audit Firm ◽  
The Past ◽  
Big 4 ◽  
The Difference ◽  
Athens Stock Exchange ◽  
The Impact

In 2002, developments in the global markets during the past decades have highlighted the need for common accounting standards among companies all around the world so as the financial statements to be comparable. From 2005 onwards the Greek Companies listed on the Athens Exchange was an accounting “revolution” of the 21st century, given the difference in philosophy between the Greek GAAP and the International Accounting Standards-IAS (next, IFRS). This study evaluates the implementation of IFRS on the financial statements of Greek publicly listed companies of high and medium capitalization, which are companies that are included in the FTSE 20 and FTSE 40 indexes of the Athens Stock Exchange-ASE, respectively. Also, for those firms we examined the effect of the size of the audit firm. The research was conducted based on the analysis of thirteen ratios. According to our analysis only few of the ratios have changed significantly. Finally, regarding the impact of the size of the audit firm the results reveal controversy with the present bibliography concerning “Big 4” in comparison with “non-Big 4” firms in Greece

Firm Equity Investment Decisions and U.S. GAAP and IFRS Consolidation Control Guidelines: An Empirical Analysis

2017 ◽  
Vol 16 (1) ◽  
pp. 37-57 ◽  
Author(s):  
Allison K. Beck ◽  
Bruce K. Behn ◽  
Andrea Lionzo ◽  
Francesca Rossignoli
Keyword(s):  
Accounting Standards ◽  
Data Availability ◽  
Marginal Effect ◽  
Investment Behavior ◽  
Strategic Investment ◽  
Equity Investment ◽  
Bright Line ◽  
Accounting Scandals ◽  
Control Concept ◽  
The U.S

ABSTRACT It is asserted in the literature that rules-based accounting standards leave room for transaction structuring and that numerous accounting scandals have been linked to companies structuring transactions to avoid bright-line rules. Prior research suggests that bright-line accounting standards motivated companies to avoid the equity method or consolidation accounting by keeping their equity ownership percentages below the key thresholds of 20 percent and 50 percent. However, in recent years, much has changed regarding U.S. GAAP and IFRS principles, especially in terms of the guidelines surrounding business combinations and the concept of control. Now, given the similarity of the U.S. GAAP and IFRS equity investment accounting standards and their more recent emphasis on the control concept, one would not expect either U.S. GAAP or IFRS firms to engage in transaction-structuring behavior, holding concentrated ownership percentages at, or right below, 50 percent. Our study extends prior research by investigating whether this phenomenon (of investment percentages being concentrated right at 50 percent or just below) exists in today's FASB and IASB reporting environments and if so, why? Using ownership data from 2004–2008, we investigate whether firms engage in strategic investment behavior in the vicinity of the 50 percent ownership threshold within the U.S. GAAP and IFRS reporting environments. Interestingly, our univariate results indicate that despite a shift in the accounting standards to a more principles-based definition of control, U.S. GAAP-compliant and IFRS-compliant companies continue to behave in a manner indicative of purposeful transaction structuring around the 50 percent threshold, as evidenced by an unusually heavy concentration of investment at or below 50 percent. This finding could mean that U.S. GAAP- and IFRS-compliant companies (and their auditors) are continuing to anchor to the old bright-line guidance regarding consolidation accounting. We supplement our univariate tests with a regression analysis to examine potential incentives that could explain this investment behavior. We find that leverage has a significant positive marginal effect—increased leverage is associated with a greater likelihood of choosing to keep the investment level at or below 50 percent. Data Availability: The ownership data for this study were obtained from the Bureau van Dijk OSIRIS Ownership database. Data will be made available in accordance with the American Accounting Association's data integrity policy.

A Perspective on the Joint IASB/FASB Exposure Draft on Accounting for Leases

2011 ◽  
Vol 25 (4) ◽  
pp. 861-871 ◽  
Author(s):  
Yuri Biondi ◽  
Robert J. Bloomfield ◽  
Jonathan C. Glover ◽  
Karim Jamal ◽  
James A. Ohlson ◽  
...  
Keyword(s):  
Balance Sheet ◽  
Accounting Standards ◽  
Financial Accounting ◽  
International Accounting Standards ◽  
Financial Accounting Standards Board ◽  
Operating Leases ◽  
Key Issues ◽  
Definition Of ◽  
The Impact ◽  
Lease Accounting

SYNOPSIS The International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) recently issued a joint exposure draft on accounting for leases. This exposure draft seeks to shift lease accounting from an “ownership” model to a “right-of-use” model. Under the current ownership model, leases can be reported on balance sheet (finance leases) if certain tests are met, or off balance sheet (operating leases) if those tests are not met. The new model seeks to report all leases on the balance sheet based on the present value of lease obligations without any bright line tests, and no sharp on or off the balance sheet classifications. We are sympathetic to the standard setters' concern that the current lease standard is being manipulated improperly by managers, resulting in large amounts of debt being reported off balance sheet. We provide a discussion of current lease accounting and the proposed exposure draft. We also comment on five key issues covered by the exposure draft: the definition of a lease, the initial measurement and eventual reassessment at fair values, the accounting for lessors, the impact of lease accounting on recognition and income measurement, and classification of lease accounting elements and their impact on accounting ratios. JEL Classifications: M40.

scholarly journals Corporate Governance Principles and Sustainability

2017 ◽  
Vol 1 (2) ◽  
pp. 13-19 ◽  
Author(s):  
Hugh Grove ◽  
Maclyn Clouse
Keyword(s):  
Corporate Governance ◽  
21St Century ◽  
Boards Of Directors ◽  
Financial Analysts ◽  
Accounting Standards ◽  
Lessons Learned ◽  
International Accounting Standards ◽  
Short Sellers ◽  
The U.S

With 21st century U.S. frauds destroying well over one trillion of market capitalization and now with Valeant’s 2016 market cap destruction of $86 billion, the question must again be asked: where were the gatekeepers (boards of directors, regulators, sell-side financial analysts, and auditors) to protect investors? Many of these frauds were caught only by short sellers, such as Jim Chanos (shorting Enron in 2000 and Valeant in 2014), Andrew Left (shorting Valeant in 2015), and buy-side financial analysts. Sir David Tweedy, the former chair of the International Accounting Standards Board, has commented: “The scandals that we have seen in recent years are often attributed to accounting although, in fact, I think the U.S. cases are corporate governance scandals involving fraud” (Tweedy, 2007). This paper is a case study using the Valeant $86 billion market cap destruction in 2016 to emphasize the timeless nature of such corporate governance scandals. This scandal was even larger than the infamous $78 billion market cap destruction scandal of Enron which occurred 15 years earlier in 2001. These scandals appear here to stay as the new normal so these gatekeepers should be doing everything they can to analyze the ongoing fraud problems. Accordingly, as a case study, this paper develops lessons learned from this $86 billion Valeant scandal to emphasize the importance of sustainable corporate governance principles as a pathway to avoid malpractices in the future.

scholarly journals Corporate governance and Chinese ghost cities

2016 ◽  
Vol 13 (4) ◽  
pp. 249-265
Author(s):  
Hugh Grove ◽  
Mac Clouse
Keyword(s):  
Corporate Governance ◽  
Financial Reporting ◽  
Accounting Standards ◽  
International Accounting ◽  
International Accounting Standards ◽  
Fraudulent Financial Reporting ◽  
The U.S ◽  
International Accounting Standards Board

Sir David Tweedy, the former chair of the International Accounting Standards Board, observed: “The scandals that we have seen in recent years are often attributed to accounting although, in fact, I think the U.S. cases are corporate governance scandals involving fraud” (Tweedy, 2007). This paper will show that many of the recent Chinese cases of fraudulent financial reporting are also really corporate governance scandals involving fraud.

scholarly journals Impact Of IASB & FASB On Financial Statements

2011 ◽  
Vol 8 (8) ◽  
Author(s):  
Veronica Paz ◽  
Thomas Griffin
Keyword(s):  
Conceptual Framework ◽  
Accounting Standards ◽  
Financial Statements ◽  
Financial Accounting ◽  
International Accounting ◽  
International Accounting Standards ◽  
Financial Accounting Standards Board ◽  
The Impact ◽  
International Accounting Standards Board

The purpose of this research is to determine the impact of material differences in the conceptual framework of the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) on the financial statements.

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