scholarly journals Sustainability Performance Indicators and Non-Financial Information Reporting. Evidence from the Italian Case

2020 ◽  
Vol 10 (1) ◽  
pp. 13 ◽  
Author(s):  
Domenico Raucci ◽  
Lara Tarquinio
Keyword(s):  
Financial Reporting ◽  
Performance Indicators ◽  
Value Added ◽  
Financial Information ◽  
Reporting Practices ◽  
Sustainability Performance ◽  
Italian Case ◽  
Eu Directive ◽  
Before And After ◽  
Guidelines And Standards

Non-financial reporting is a growing topic, and the adoption of the EU Directive 2014/95/EU on non-financial information (NFI) is increasing the use of this reporting. One of the most distinctive elements of guidelines and standards that are widely used to draw-up reports on NFI is sustainability performance indicators (SPIs). SPIs can provide a significant value-added to non-financial corporate communication, and they are useful tools to support internal decision-making processes. The purpose of this study is to examine the effects produced on SPIs disclosure by the entry into force of the Italian Decree implementing the Directive on NFI. Content analysis method is used to analyze indicators disclosed by Italian companies before and after the adoption of the Decree. Findings show that each category of SPIs was largely used by the companies of our 2012 sample, but a reduction of the quantity of indicators disclosed was documented in 2017. Therefore, after the introduction of mandatory disclosure of NFI, companies seem to focus only on indicators considered more “relevant” according to the Directive. This research represents one of the preliminary analysis on the adoption of the Directive in Italy and on its first effects on NFI reporting practices.

scholarly journals Reliability of Financial Information from the Perspective of Benford’s Law

Entropy ◽  
2021 ◽  
Vol 23 (5) ◽  
pp. 557
Author(s):  
Ionel Jianu ◽  
Iulia Jianu
Keyword(s):  
Financial Reporting ◽  
Capital Market ◽  
Financial Statements ◽  
Financial Information ◽  
Benford’S Law ◽  
Professional Judgment ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Benford's Law ◽  
Before And After

This study investigates the conformity to Benford’s Law of the information disclosed in financial statements. Using the first digit test of Benford’s Law, the study analyses the reliability of financial information provided by listed companies on an emerging capital market before and after the implementation of International Financial Reporting Standards (IFRS). The results of the study confirm the increase of reliability on the information disclosed in the financial statements after IFRS implementation. The study contributes to the existing literature by bringing new insights into the types of financial information that do not comply with Benford’s Law such as the amounts determined by estimates or by applying professional judgment.

scholarly journals Adoption of IFRS in Ecuador and Colombia 2010-2016

2019 ◽  
Vol 16 (1-1) ◽  
pp. 178-184 ◽  
Author(s):  
José Villanueva García ◽  
Carmen Cordova Román ◽  
Maria Teresa Cuenca Jiménez
Keyword(s):  
Financial Reporting ◽  
Research Work ◽  
Balance Sheet ◽  
Accounting Standards ◽  
Nonparametric Test ◽  
Financial Information ◽  
International Accounting Standards ◽  
Financial Reporting Standards ◽  
Before And After ◽  
Mandatory Adoption

The International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB), have been adopted by a large number of countries, since they are considered an international benchmark for obtaining comparable quality financial information. The adoption by Ecuador and Colombia of IFRS as a transition from their previous local regulations based on provisions and decrees, justifies the present research work to provide knowledge of the regulatory reality of both countries. Behind this ambitious adoption of accounting standards, since they are costly processes both financially and in terms of training, there is a need to obtain consistent financial information that should attract investments and facilitate access to other less harmful financial markets. The purpose of this research is to perform an analysis of the effect on the accounting variables of the balance sheet and financial ratios, before and after the application of IFRS on large Ecuadorian and Colombian companies. To do this, Wilcoxon’s nonparametric test of related samples is used, on a total of 204 Ecuadorian companies and 60 Colombian companies. To compare the results of both countries, a non-parametric U Mann-Whitney test is carried out. The results show an impact in both countries on the variables studied after the mandatory adoption of IFRS, although the relative impact is greater in the Colombian case.

scholarly journals Die staat van toegevoegde waarde as komponent van finansiele verslaggewing in die RSA

1991 ◽  
Vol 22 (3) ◽  
pp. 53-62
Author(s):  
A. P. Du Plessis ◽  
D. S. Joubert
Keyword(s):  
South African ◽  
Financial Reporting ◽  
Value Added ◽  
Financial Statements ◽  
Financial Information ◽  
Financial Reports ◽  
A Value ◽  
Information Contents

The value added statement as component of financial reporting in the RSA The value added statement was developed due to a need for more understandable financial information for the uninformed user of financial statements. Although not required by the Companies Act, since 1977 numerous South African companies have included a value added statement in their financial reports. The question can, however, be asked whether the inclusion of a statement of value added in financial reports will not put financial information at the disposal of a larger group of existing and potential users of financial statements. In such a case the inclusion of the statement should be made compulsory and the contents be standardized. During a study of the reasons for the publication and the presentation of the information of this statement by South African companies, it was found that companies probably publish this statement for the annual competitions for financial statements. The information contents of the statement is therefore disregarded.

Regulating non-financial reporting: evidence from European firms’ environmental, social and governance disclosures and earnings risk

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Arif ◽  
Christohper Gan ◽  
Muhammad Nadeem
Keyword(s):  
Financial Reporting ◽  
Positive Impact ◽  
Content Type ◽  
Eu Directive ◽  
Before And After ◽  
The Difference ◽  
Earnings Risk ◽  
The Impact ◽  
The Eu

Purpose Motivated by the enactment of non-financial reporting regulations by the European Parliament, this paper aims to investigate the impact of European Union (EU) directive 2014/95/EU on the quantity of environmental, social and governance (ESG) disclosures by the S&P Europe 350 index firms. This study also investigates whether the implementation of the non-financial information (NFI) reporting regulations influences the association between ESG disclosures and firms’ earnings risk. Design/methodology/approach To measure the impact of mandatory regulations on the quantity of ESG disclosures, this study estimates the average treatment effects using a propensity weighted sample. Then this study uses the difference-in-differences method to estimate the differences in the association between ESG disclosures and earning risk before and after implementation of the EU directive. Findings The results show a significant positive impact of the EU directive on the quantity of ESG disclosures for the sample European public-interest entities, which indicates that the mandatory NFI reporting requirements could boost the availability of increasingly demanded ESG related information. The enhanced association between the ESG disclosures and firms’ earnings risk during the post-directive period reveals that mandating NFI reporting also increases the quality of ESG disclosures. Originality/value Using the legitimacy and decision-usefulness theories, this study provides novel evidence concerning the impact of the EU directive on the quantity and quality of ESG disclosures.

scholarly journals Non-financial reporting in Spain. The effects of the adoption of the 2014 EU Directive

2022 ◽  
Vol 25 (1) ◽  
pp. 3-15
Author(s):  
María-Antonia García-Benau ◽  
Helena-María Bollas-Araya ◽  
Laura Sierra-García
Keyword(s):  
Financial Reporting ◽  
Listed Companies ◽  
Financial Information ◽  
First Year ◽  
Eu Directive ◽  
Sustainability Reports ◽  
Sustainability Report ◽  
Management Report ◽  
Do So

The Directive 2014/95/EU imposes new requirements regarding the disclosure of non-financial information (NFI). The aim of this paper is to analyse the NFI disclosed by Spanish listed companies. This is a pioneering study in Spain, since it was conducted during the first year in which NFI disclosure was mandatory, according to the requirements of the Spanish adaptation of Directive. We determine whether decisions on NFI reporting adopted in this respect (i.e. to do so within the management report or as a separate sustainability report) depend on the company’s characteristics. In addition, we consider whether the content of such reports differs significantly. Findings show that some Spanish companies do not disclose mandatory NFI. Larger and more profitable companies, which belong to specific sectors and have a sustainability committee, are more likely to disclose this information in a sustainability report. The contents of management and sustainability reports present significant differences. La Directiva 2014/95/UE impone nuevos requisitos en cuanto a la divulgación de información no financiera (IFN). El objetivo de este trabajo es analizar la IFN divulgada por las empresas cotizadas españolas. Se trata de un estudio pionero en España, ya que se realizó durante el primer año en el que la divulgación de IFN era obligatoria, según los requisitos de la adaptación española a la mencionada Directiva. Determinamos si las decisiones sobre la presentación de la información no financiera adoptadas al respecto (es decir, hacerlo dentro del informe de gestión o como un informe de sostenibilidad independiente) dependen de las características de la empresa. Además, estudiamos si el contenido de dichos informes difiere significativamente. Los resultados muestran que algunas empresas españolas no divulgan la información no financiera obligatoria. Las empresas más grandes y rentables, que pertenecen a sectores específicos y que tienen un comité de sostenibilidad, son más propensas a divulgar esta información en un informe de sostenibilidad. Los contenidos de las memorias de gestión y de sostenibilidad presentan diferencias significativas.

scholarly journals Public companies non-financial reporting and audit in Ukraine: challenges and prospects

2017 ◽  
Vol 1 (1) ◽  
pp. 32-38 ◽  
Author(s):  
Inna Makarenko
Keyword(s):  
Sustainable Development ◽  
Development Strategy ◽  
Financial Reporting ◽  
Financial Information ◽  
System Reform ◽  
Accounting System ◽  
Integrated Reporting ◽  
Public Companies ◽  
Association Agreement ◽  
Eu Directive

Public interest entities and public companies as their representatives should be an example in implementing of sustainable development initiatives (sustainable development goals of the United Nations, development strategy «Europe-2020», «Sustainable Development Strategy»Ukraine-2020») in the light of Association agreement. Main challenges for Ukrainian public companies are non-financial information disclosure and assurance of both financial and non-financial reporting through statutory audit. Key prospects of public companies accounting system reform were outlined in this regard. This research may contribute to the existing literature in regard of identifying key areas of improving financial and non-financial information PIEs disclosure as well as its independent verification through statutory audit. This improvement should incorporate European experience and provision of Directive 2014/95 / EU, Directive 2013/34 / EU, Directive 2014/56 / EU and Regulation (EU) no. 537/2014. Among the promising areas of research, introduction of integrated reporting for Ukrainian PIEs is worth noting.

The impact of the EU Directive on non-financial information: Novel features of the Italian case

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Rosa Lombardi ◽  
Antonietta Cosentino ◽  
Alessandro Sura ◽  
Michele Galeotti
Keyword(s):  
Institutional Theory ◽  
Financial Information ◽  
Institutional Pressures ◽  
The European Union ◽  
Public Companies ◽  
Content Type ◽  
Reporting Practices ◽  
Eu Directive ◽  
The Impact ◽  
The Eu

Purpose This paper aims to examine the European Union (EU) 95/2014 Directive’s impact on large public companies. It chose Italy as a pivotal country that made non-financial information assurance mandatory, going beyond the EU Directive’s original requirements. Specifically, it investigates how the UE Directive fosters institutionalisation of the non-financial reporting (NFR) process in organisations. Design/methodology/approach Two large public companies in Italy are used as case studies. Data are gathered from annual and integrated reports, institutional websites and semi-structured interviews with the managers and employees involved in different organisational positions. The authors adopted the neo-institutional theory as a theoretical lens to identify the organisations’ response to the (external) institutional pressures influencing corporate reporting practices. Findings The findings demonstrate how the EU Directive fostered changes to large public companies’ reporting practices and external pressures contributed to influencing changes to internal organisational practices in terms of new internal processes, procedures and structures. These changes are motivated by the companies’ need to guarantee reliable information to be produced in their non-financial reports. Practical implications This paper helps academics and policymakers to advance NFR practices by understanding regulatory factors that can foster changes in the internal reporting process and responsibility within organisations. Originality/value The findings provide some empirical insights to foster reflections on the EU Directive’s effectiveness in changing reporting practices. This paper contributes to enriching the literature on institutional theory in shaping mandatory non-financial disclosure by identifying the institutional pressures influencing the effectiveness of regulations to change NFR practices.

The non-financial reporting practices of Hungarian listed public interest entities considering the 2014/95/EU Directive

2022 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Edit Lippai-Makra ◽  
Zsuzsanna Ilona Kovács ◽  
Gábor Dávid Kiss
Keyword(s):  
Financial Reporting ◽  
Public Interest ◽  
Intangible Assets ◽  
Reporting Quality ◽  
Mandatory Reporting ◽  
Content Type ◽  
Reporting Practices ◽  
Corporate Strategies ◽  
Eu Directive ◽  
The Impact

PurposeThis paper aims to investigate the non-financial reporting (NFR) practices of Hungarian listed public interest entities for 2016–2018 in terms of the required disclosure content based on the 2014/95/EU Directive (ED).Design/methodology/approach The authors apply content analysis methodology on Hungarian firms subject to mandatory reporting under the ED. The target variable in the multivariate model is the reporting quality (Qi) measured by a combined index.Findings The authors find that the ED had a moderate impact on Hungary's reporting quality because the overall disclosure of the sample only increased from low to medium level. The authors found that the value of intangible assets is a determinant of the reporting quality before and after the implementation of the ED. The findings support the effect of coercive isomorphism on Hungarian NFR practices.Research limitations/implications The limitation of the research is the number of firms examined. However, the authors covered the entire (non-bank) community of the Hungarian firms subject to the ED.Practical implications The authors suggest that reporting entities build upon the synergy between intellectual capital disclosure and NFR when elaborating their reporting strategies. The authors recommend the integration of ethical matters into corporate strategies and policies. Policymakers may consider the revision of the Hungarian regulations. The authors suggest academics embrace these topics in teaching.Originality/value To the best of the authors’ knowledge, this is the first study that investigates the impact of ED in the context of Hungary. The authors contribute to the existing literature by adding the results of the ridge regression model, highlighting the importance of intangible assets.

scholarly journals Critical reflection on XBRL: A “customisable standard” for financial reporting?

2013 ◽  
Vol 3 (2) ◽  
pp. 110
Author(s):  
Diego Valentinetti ◽  
Michele Antonio Rea
Keyword(s):  
Conceptual Framework ◽  
Financial Reporting ◽  
Critical Reflection ◽  
Financial Information ◽  
Financial Data ◽  
Specific Information ◽  
Reporting Practices ◽  
Data Comparability ◽  
The Us ◽  
Implementation Models

In this paper, we discuss the dual power of XBRL to standardise and/or accommodate firms’ financial reporting practices. We first develop a conceptual framework for understanding which factors may affect the adoption of XBRL and, in turn, standardise or customise financial reporting. We then examine the XBRL implementation models adopted in two countries: Italy and the US. In Italy, XBRL is required through the application of a standard taxonomy (the Italian GAAP Taxonomy), without the ability to create and submit taxonomy extensions. Conversely, in the US, XBRL is required through the application of a standard taxonomy (the US GAAP Taxonomy), along with the ability to define individual extensions to be submitted to the SEC. We discuss the potential effects of taxonomy application on the representation of financial information. The application of a taxonomy on a “blind basis” (extensions not permitted) leads not only to the full comparability of financial data but also to a loss of idiosyncratic information. The application of a taxonomy on a “minimum basis” (individual extensions permitted) preserves specific information, but causes a potential loss of data comparability.

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