scholarly journals Compliance of Financial Statements of Islamic Banks of Pakistan with AAOIFI Guidelines in General Presentation and Disclosure

2018 ◽  
Vol 2 (1) ◽  
pp. 12-21 ◽  
Author(s):  
Asim Ehsan ◽  
Syed Kashif Saeed ◽  
Muhammad Asghar Shahzad ◽  
Hafiz Rauf Iqbal
Keyword(s):  
Financial Reporting ◽  
Empirical Evaluation ◽  
Accounting Standards ◽  
Financial Statements ◽  
Decision Makers ◽  
Financial Statement ◽  
Islamic Banks ◽  
Voluntary Disclosures ◽  
Regulatory Requirements ◽  
Financial Reporting Standards

Objective - This study intends to investigate the extent of voluntary financial reporting compliance made by Islamic banks of Pakistan as suggested by Islamic accounting standards (i.e. AAOIFI).  Design/Methodology - The study is based on an empirical evaluation of financial statements of Islamic banks of Pakistan. Data sample consists of financial statements for the years 2009, 2015, 2016 and 2017 relating to of all four full-fledged Islamic banks in Pakistan. The first standard in Islamic accounting standards suggests a total of 111 items for compliance while preparing a financial statement of Islamic Banks. As per existing regulatory requirements, Islamic banks in Pakistan are required to adopt International Financial Reporting Standards while preparing their financial statements.  Findings - However, the analysis suggests Islamic banks in Pakistan are in compliance of more than 50% of requirements as suggested by Islamic accounting standards.  Implications – The insights will help the industry decision makers to increase the voluntary disclosures by the Islamic banks.

How Does Local Adoption of IFRS for Those Countries That Modified IFRS by Design, Impair Comparability with Countries That Have Not Adapted IFRS?

2017 ◽  
Vol 16 (3) ◽  
pp. 59-90 ◽  
Author(s):  
Elizabeth Felski
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
Financial Statement ◽  
International Accounting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Study Results ◽  
Reporting Environment ◽  
Proper Translation

ABSTRACT Global adoption of International Financial Reporting Standards (IFRS) is thought to increase financial statement reliability and comparability. Although IFRS is required or allowed in over 130 nations, some countries modify IFRS as issued by the International Accounting Standards Board (IASB). This study is designed to closely examine each country that modifies IFRS in an effort to determine whether these modifications impair financial statement comparability. First is that countries lack the resources to implement the newest version of IFRS or ensure proper translation of the standards. Second is that countries make specific changes to allow IFRS to better meet the needs of their financial reporting environment. I categorize the first set of countries as default countries and the second set as design countries. The study results in several interesting and useful contributions. First, I develop a new typology for future IFRS research that includes not only the locally adopted category, but also the default and design categories. Second, the details of how countries modify IFRS make it clear that differences can exist in financial statements prepared in different countries both using IFRS. The users must be careful to understand how comparability may be impacted by these modifications.

scholarly journals IFRS Adoption and Reporting Quality: An Assessment of User’s Perception in Nigeria

2021 ◽  
pp. 1-9
Author(s):  
Aminu Abdullahi ◽  
Hadiza Ahmed Suleiman
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Reporting Quality ◽  
Financial Statements ◽  
Financial Statement ◽  
Comparative Approach ◽  
Financial Reports ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Qualitative Characteristics

The study assessed the perception of financial statement users on the extent of reporting quality following IFRS adoption in Nigeria. A comparative approach was utilized, where users’ (investors)opinions on reporting quality between the Statement of Accounting Standards (SAS) regime and the International Financial Reporting Standards regime were sought and compared. The results obtained from the structured Likert scale questionnaires were analyzed using the T-Test. It was found that all the qualitative characteristics of financial reporting which were used as reporting quality variables in the study have improved with the adoption of IFRS except for the extent of the ability of financial reports to confirm or correct prior user’s expectation which was discovered to be better during SAS regime. It was recommended that the Financial Reporting Council of Nigeria (FRCN) should embark on advocacy aimed at educating investors’ especially, institutional on the issue of prediction and assessment of IFRS-based financial statements.

Research of Estimated Liabilities During the Audit of Accounting (Financial) Statements

Auditor ◽  
2021 ◽  
pp. 33-39
Author(s):  
N. Loseva
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards

The article discusses the estimated liabilities, their study and assessment in accordance with the provisions of Russian accounting standards (RAS) and International Financial Reporting Standards (IFRS).

scholarly journals The Impact of Financial Statement Comparability on Earnings Management: Evidence from Frontier Markets

2020 ◽  
Vol 8 (4) ◽  
pp. 73
Author(s):  
Wil Martens ◽  
Prem W. S. Yapa ◽  
Maryam Safari
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Common Law ◽  
Accounting Standards ◽  
Real Earnings Management ◽  
Financial Statement ◽  
Financial Reporting Standards ◽  
Developed Markets ◽  
Accounting Comparability ◽  
The Impact

This paper examined whether financial statement comparability constrains opportunistic earnings management in frontier market countries. Using a large sample of 19 frontier market countries, and an accounting comparability method that maps comparability across several accounting standards, the results show that enhanced financial comparability constrains accruals earnings management (AEM). Contrary to developed markets and novel to this study, a significant relationship between financial comparability and real earnings management (REM) was not found. For greater robustness, AEM and REM were also tested on both International Financial Reporting Standards (IFRS) adopting and non-adopting countries. The results suggest IFRS adoption constrains AEM, yet exhibited no impact on constraining REM. Additionally, the use of BigN auditors failed to conclusively show an ability to moderate EM. When combined, the results suggest that frontier markets engage in less REM than expected. It is also noted that the legal roots (civil vs. common law) play a significant role in constraining earnings management. Common law countries exhibited lower AEM when comparability increased; this significance was not found in countries that were rooted in civil law. Contributions from this study show that findings from developed markets cannot be generalised to frontier markets.

Ruckman, Inc.: Converting from U.S. GAAP to IFRS

2011 ◽  
Vol 26 (2) ◽  
pp. 341-360 ◽  
Author(s):  
Rebecca Fay ◽  
John A Brozovsky ◽  
Patricia G Lobingier
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
The United States ◽  
Securities And Exchange Commission ◽  
High Demand ◽  
Financial Reporting Standards ◽  
Accounting Courses ◽  
Cpa Exam ◽  
Two Phases

ABSTRACT This case is designed as a comprehensive review of significant differences between accounting principles generally accepted in the United States of America (U.S. GAAP) and International Financial Reporting Standards (IFRS) for specific topics covered during most Intermediate Accounting courses. The task requires you to analyze and evaluate a company's significant accounting policies for compliance with IFRS as you plan and conduct the conversion of a firm's financial statements from U.S. GAAP to IFRS. The skills developed throughout this case are currently in high demand as IFRS is quickly becoming the global norm in accounting standards and many multinational companies based in the U.S. are already affected by these standards. The Securities and Exchange Commission (SEC) has developed a roadmap that may require U.S. companies to begin adopting IFRS in 2015. You will be tested on your knowledge of IFRS on the CPA exam. The case is presented in two phases, allowing you to experience the conversion process from planning to execution.

Classification of profit-sharing investment accounts

2017 ◽  
Vol 10 (3) ◽  
pp. 351-370 ◽  
Author(s):  
Aprilia Beta Suandi
Keyword(s):  
Financial Reporting ◽  
Sample Selection ◽  
Accounting Standards ◽  
Financial Statements ◽  
Profit Sharing ◽  
Islamic Banks ◽  
Content Type ◽  
Current Accounting ◽  
Islamic Financial Institutions

Purpose The purpose of this paper is to examine the classification of profit-sharing investment accounts (PSIAs) under various accounting standards, and determine whether Islamic banks maintain uniform practices when the same accounting standards are applied. It also aims to determine whether Islamic banks consider investment account holders (IAHs) important financial statement users by disclosing necessary information pertaining to PSIAs. Design/methodology/approach A sample composed of financial statements from 63 Islamic banks from 15 countries is compared with respect to the information related to PSIAs. Findings The results show heterogeneity of classification for PSIAs. Applying the same standards does not lead to the uniform classification of PSIAs when banks apply International Financial Reporting Standards, while financial statements applying Financial Accounting Standards by the Accounting and Auditing Organization for Islamic Financial Institutions are more similar. The perplexity in classifying PSIAs brings obscurity on the treatment for PSIA-related accounts, particularly returns attributable to IAHs. The fact of fewer disclosures pertaining to PSIAs in Islamic banks – which apply accounting standards not specifically tailored to Islamic finance – suggests that IAHs receive less attention under those accounting standards. Research limitations/implications The main limitation relates to the lack of financial statements available online and the possibility of sample selection bias toward larger Islamic banks. Originality/value This research contributes to the limited literature on accounting for PSIAs, and reveals the diversity of reporting methods for unique transactions in Islamic banks and the insufficiency of current accounting standards to guide them, which create possible challenges of comparability.

Sharia accounting standard for sukuk (Islamic bond) accounting in Indonesia

2018 ◽  
Vol 9 (3) ◽  
pp. 434-447 ◽  
Author(s):  
Dodik Siswantoro
Keyword(s):  
Interest Rate ◽  
Financial Reporting ◽  
Accounting Standards ◽  
Islamic Banks ◽  
Accounting Standard ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Islamic Bank ◽  
Before And After ◽  
Suitable Standard

PurposeThis paper aims to analyze the need of Islamic banks for specific Statement of Financial Accounting Standards (SFAS) No. 110 for sukuk accounting in Indonesia. In fact, some Islamic banks have already prepared International Financial Reporting Standards (IFRS), and accordingly, a suitable standard is needed for this case. Design/methodology/approachThe research methodology involved interview with a senior accounting manager of an Islamic bank focusing on relevant topics in sukuk to sharpen the analysis. Equally important, research reviewed and compared financial statements on sukuk accounting among Islamic banks, before and after adoption of sukuk accounting standard. FindingsIFRS require market valuation based on interest rate. As interest rate is unlawful in Islamic teaching, IFRS may not accordingly be suitable. Therefore, SFAS No. 110 was issued by the Indonesian Institute of Accountants (Ikatan Akuntan Indonesia). Considering the fact that this standard did not explicitly adopt the IFRS paradigm, there have been consequent conflicts in Islamic bank management because of preference of global recognition to IFRS. Adopting IFRS would be more compatible with other countries’ general accounting standards. In addition, significant differences are found in sukuk accounting treatments by Islamic banks before and after the standard adoption. Research limitations/implicationsThis research only focuses on such question of why specific accounting standard for sukuk accounting is needed by Islamic banks in Indonesia, while only few Indonesian Islamic banks were initially aware of the issue. Originality/valueThis paper may be the first paper discussing the response to and need for sukuk accounting in Indonesian Islamic banks.

scholarly journals Divergence within IFRS adoption: the case of depreciation practices of listed banks in Bangladesh

2020 ◽  
Vol 10 (2) ◽  
pp. 169
Author(s):  
Mezbah Uddin Ahmed
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Statements ◽  
National Standard ◽  
Accounting Standard ◽  
Pressure Groups ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Implementation Guidelines ◽  
Qualitative Characteristics

Comparability is one of the qualitative characteristics of financial statements that are prepared in compliance with the International Financial Reporting Standards (IFRS). The objective of this research is to identify whether this qualitative characteristic can be negated even when entities apply IFRS. In achieving the research objective, the depreciation policies adopted by the listed banks in Bangladesh are identified and compared with each other. This research finds that despite increasing effort by accounting standard setters and pressure groups to achieve IFRS-compliance and harmonization in accounting practices, non-compliance and divergence still exists. This research also finds that the divergence in depreciation practices can be of enough significance to negate comparability. The findings of this research expected to assist the international and national standard setters as well as the regulators in understanding the practical issues in implementing accounting standards and developing clearer IFRS implementation guidelines.

Factors that influenced the adoption of IFRS by Islamic banks in the UAE

2020 ◽  
Vol 33 (1) ◽  
pp. 75-91 ◽  
Author(s):  
Mohammad Haroun Sharairi
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Adoption Process ◽  
Islamic Banking ◽  
Reporting Standards ◽  
Islamic Banks ◽  
Content Type ◽  
Financial Reporting Standards ◽  
The Relationship

Purpose This paper aims to investigate the factors that influenced the current adoption of the international financial reporting standards (IFRS) by Islamic banks in the UAE. This paper examined the relationship between the theoretical aspects and practical components of the research investigation regarding the factors that influence the adoption of IFRS. This paper will contribute to the existing knowledge and practices in not only Islamic countries but also Western countries in terms of a deeper understanding of the adoption of IFRS by the Islamic banks and how the factors could influence the Islamic banking adoption, process, activities and financial reporting. Design/methodology/approach Several theories of regulation were considered in this paper to explain the existence of Islamic accounting regulations and understand why some of the Islamic accounting prescriptions became formal regulations, while others did not. Data was collected for this purpose by conducting a survey with professionals and managers of four Islamic banks in the UAE. Findings This paper revealed that factors, such as religion, culture and local investors, may have limited influence on the current adoption of accounting standards in the Islamic banks. Furthermore, this paper uncovered a concern among respondents of issues that developed when Islamic banks commenced the adoption of IFRS. This paper also indicated that respondents’ opinion does not reflect a perception that all IFRS are suitable for the application of Shariah transactions. Originality/value This study is unique as no study has yet explored the factors that influenced the adoption of the IFRS by Islamic banks in the UAE.

The Effect of Audit Duality on Audit Quality

2020 ◽  
Vol 19 (2) ◽  
pp. 65-89
Author(s):  
Lawrence Chui ◽  
Oksana Kim ◽  
Byron J. Pike
Keyword(s):  
Financial Reporting ◽  
Audit Quality ◽  
Accounting Standards ◽  
Financial Statement ◽  
Regulatory Environment ◽  
Public Companies ◽  
Potential Reduction ◽  
Audit Firm ◽  
Financial Reporting Standards ◽  
Jel Classifications

ABSTRACT The Russian regulatory environment offers a unique audit duality situation in which public companies receive two separate financial statement audits by the same audit firm: one based on Russian Accounting Standards (RAS) and the other on International Financial Reporting Standards (IFRS). We assess whether audit duality influences audit quality, measured by modifications to the standard audit report. Using a sample of public Russian companies from 2004 to 2016, we find that audit duality significantly reduces auditors' propensity to modify the audit opinions for both the RAS and IFRS audits as compared to companies that engage a different firm for each audit. This potential reduction in audit quality is mitigated when the company is in a loss position. The presence of Big N dual auditors does not diminish the observed findings and, in fact, appears to translate into lower-quality RAS-based audits of financially distressed companies. JEL Classifications: M42; M48.

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