scholarly journals The Accounting Conservatism of the Adoption of IFRS in Indonesia

2018 ◽  
Vol 3 (4) ◽  
pp. 93-104
Author(s):  
Juniarti Juniarti ◽  
Devi Tirta Raharjo ◽  
Regina Monica
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Least Square Method ◽  
Jel Classification ◽  
Accounting Conservatism ◽  
Least Square ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Accounting Standard ◽  
Industrial Sectors

Objective - The Indonesian Accounting Standard Authority has required companies to adopt the International Financial Reporting Standard (IFRS) since its adoption in 2012. The new standard emphasizes relevance, while the previous standard focused on conservative issues. While the IFRS does not specifically aim to reduce conservatism, this aspect is no longer the emphasis of the new standard. There are concerns about whether the IFRS reduces conservatism and the research on this issue are still uncertain. Hence, this study aims to determine the level of conservatism in the period following the adoption of the IFRS. The study also aims to examine the outcome of the adoption of the IFRS since its adoption in Indonesia in 2012. Methodology/Technique - Using the accounting conservatism model developed by Basu (1997), the authors compare firm conservatism before and after the adoption of the IFRS. The sample includes companies listed on the Indonesian Stock Exchange between 2006 and 2016. There are 3.742 firm-years that consist of 394 companies from various industrial sectors. The data is analyzed using a Pooled Least Square method. Findings - The results show that conservatism was high prior to the adoption of the IFRS. Further, accounting earnings are more sensitive to the negative return than to the positive return before the adoption of the IFRS. However, in the post-adoption period, sensitivity to negative return has decreased. This means that the adoption of the IFRS has reduced levels of conservatism. The Indonesian Accounting Standard Authority may rely on these results to evaluate the mandatory policy of IFRS. Novelty - This study explores the prevalence of conservatism within firms prior to, and following, the adoption of the IFRS using longitudinal data. Type of Paper Empirical Keywords: Conservatism; Earning Quality; IFRS Adoption; Indonesia; Pre and Post-adoption. JEL Classification: M41, M48.

scholarly journals The impact of the IFRS 15 implementation on the revenue based earnings management in Poland

2021 ◽  
Vol 43 ◽  
pp. 387-403
Author(s):  
Izabela Morawska ◽  
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Stock Exchange ◽  
Empirical Studies ◽  
Jel Classification ◽  
Revenue Recognition ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Warsaw Stock Exchange ◽  
The Impact

Aim/purpose – This paper aims at investigating whether the International Financial Reporting Standard (IFRS) 15 Revenue from Contracts with Customers implementation in Poland has affected earnings management that uses discretion in revenue recognition to avoid losses and earnings decreases. Design/methodology/approach – The empirical studies were conducted using a sample of 80 entities from four industries listed on the Warsaw Stock Exchange (WSE) in Poland from 2016 to 2019. Caylor’s (2010) revenue-based model was applied, and an econometric model describing the studied relation was built and verified to this end. Findings – The analyzed entities managed earnings using discretion in accrued revenue recognition to avoid reporting losses. The research results did not confirm that the IFRS 15 adoption in Poland influenced revenue-based earnings management aimed at avoiding losses and earnings decreases. Research implications/limitations – This study warns of the role played by discretion in revenue recognition and recommends careful recognition of revenue under IFRS 15. Limitations of this study are generally related to the models’ specification and a relatively small number of the entities studied. Originality/value/contribution – This study contributes to the literature on revenue- -based earnings management and is one of the first studies on the association between IFRS 15 adoption and revenue-based earnings management in Poland. Thus, this study bridges the research gap in Poland. Keywords: IFRS 15, earnings management, revenue recognition, earnings benchmarks. JEL Classification: M40, M41, M48.

The Effect of IFRS Convergence on Earnings Quality: Empirical Evidence from Indonesia

2017 ◽  
Vol 2 (4) ◽  
pp. 21-31
Author(s):  
Paulina Sutrisno ◽  
Indra Arifin Djashan
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Negative Impact ◽  
Stock Exchange ◽  
Earnings Quality ◽  
Jel Classification ◽  
Real Earnings Management ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
The Impact

Objective - The purpose of this research is to examine the impact of the International Financial Reporting Standard (IFRS) convergence in Indonesia on earnings quality. Methodology/Technique - Earnings quality is measured on both accrual earnings management and real earnings management. Indonesia began convergence IFRS in 2012. IFRS is considered capable of improving comparability, transparency, and earnings information, which is expected to ultimately improve earnings quality. The sample in this research uses manufacturing firms listed on the Indonesian Stock Exchange that were suspected to avoid loss during the observation period. The data consist of 45 companies examined between 2008 and 2015. Results - This study uses statistical methods and multiple regression linear to analyse the data. The research results show that IFRS convergence in Indonesia has had a negative impact on accrual earnings management and no impact on real earnings management. Novelty - The evidence shows that IFRS convergence in Indonesia has the ability to improve earnings quality related to a decrease in accrual earnings management but not real earnings management. Type of Paper: Empirical Keywords: IFRS; Discretionary Accrual; Abnormal Cash Flow Operation; Abnormal Production; Abnormal Discretionary Expenditure. JEL Classification: M40, M41, M49

scholarly journals Pengaruh Implementasi Asi International Financial Reporting Standard dalam Rangka Indeks Gray Leverage terhadap Pengungkapan Laporan Keuangan

2018 ◽  
Vol 5 (2) ◽  
pp. 164-169
Author(s):  
Desi Efrianti ◽  
Yanto .
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Descriptive Analysis ◽  
Linear Regression Analysis ◽  
Financial Statements ◽  
Financial Disclosure ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Accounting Standard ◽  
Financial Reports

Disclosure of financial statements is a mean of delivering information by the company’s internal to stakeholders outside of the company. On this globalization era, IASC (International Accounting Standard Committee) tries to create a custom standard for all in order to financial statement can be understood by all users in different countries, and so the IFRS (International Financial Reporting Standard) is published. It certainly brings a big impact on accounting study in Indonesia. One of those is about convergence of IFRS into PSAK as base of financial reporting as one form of disclosure to stakeholders outside of the company. This study was conducted to obtain empirical evidence about the effect of the implementation IFRS on the disclosure of financial statements as measured by leverage in this case the Gray index. The populations in this study are all listed banks in Indonesia Stock Exchange for the period of 2009-2014. Sample was 30 banking firms selected using purposive sampling method with predetermined criteria. Independent variable is in the form of leverage Gray index. Analysis used in this study is a descriptive analysis and simple linear regression analysis with SPSS as tool for calculation. The result showed the implementation of IFRS in the leverage Gray index has no effect on financial disclosure. Conclusions of the research are implementation of IFRS itself has effect on the financial disclosure but Gray index leverage has no significant effect under the IFRS standards. Result from t-test value is -0.122 and smaller than t-table value of 2.048. Thus, the variable of Gray index leverage is not recommended to be used to measure the width of financial reports disclosures under the standards of IFRS. There are still many aspects to be studied to determine the effect of accounting standards using other representations of company characteristics.

Quality and quantity of FTSE-100 segmental information reporting

2019 ◽  
Vol 32 (3) ◽  
pp. 326-343 ◽  
Author(s):  
Ghassan H. Mardini ◽  
Sameh Ammar
Keyword(s):  
Financial Reporting ◽  
Boards Of Directors ◽  
Stock Exchange ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Content Type ◽  
Information Reporting ◽  
Ifrs 8 ◽  
The Uk ◽  
The Impact

Purpose This study aims to explore the impact of international financial reporting standard no. 8 (IFRS 8) on segmental information reporting (SIR) after the post-implementation review (PIR) issued by international accounting standards board (IASB). This impact is examined in relation to quality and quantity as SIR dimensions represent, respectively, the level of reported items and segments. As a complement to this, the chief operating decision maker (CODM) identity is considered to understand the patterns of SIR dimensions. Design/methodology/approach The SIR of the UK financial times stock exchange 100 (FTSE-100) listed companies over the period 2013-2016 is the research’s scope. Several criteria were developed to ensure a representative research sample. A disclosure index approach was used facilitating the use of content analysis for data collection, which pertained to the dimensions of SIR published by the FTSE-100 following IFRS 8 PIR. Findings The IFRS 8 PIR has had several implications shaping the growing trend that is underpinned by the SIR dimensions published by FTSE-100 companies. First, the SIR quantity dimension positively corresponds over 2013-2016, but it still does not meet IASB’s demands. This, secondly, also applies to the quality dimension of SIR to uncover inconsistency with the existing knowledge being held regarding the introduction of IFRS 8. More specifically, the response of the FTSE-100 to mandatory and voluntary items seems to be in transition of substitution. Third, CODM’s identity was an insightful dimension in rationalising the understanding through the aforementioned dimensions. It is undertaken by boards of directors or executive committees and the case of the latter is associated with more disclose in relation to the CODM’s identity. Practical implications These findings reveal implications to: academics undertaking further research about IFRS 8 PIR to challenge or endorse this conclusion, using similar or alternative approaches; the stakeholders’ decision-making process; and policymakers to re-think the structure of mandatory and voluntary items. Originality/value This paper provides empirical evidence on the quality and quantity of SIR published by FTSE-100 companies following IFRS 8 PIR.

scholarly journals Earning Management AND International Financial Reporting Standard (IFRS) Implementation Process: Empirical Study

2020 ◽  
Vol 9 (2) ◽  
pp. 603
Author(s):  
Omar Alhawatmeh
Keyword(s):  
Empirical Study ◽  
Financial Reporting ◽  
Stock Exchange ◽  
Implementation Process ◽  
Listed Companies ◽  
Earning Management ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Amman Stock Exchange ◽  
Jones Model

This research came for studying the implementation IFRSs and its impact on earning management in Jordan .The data onto analysis will be the  listed companies of Amman Stock Exchange (ASE) for period is from 2001-2018, and to find value earning management (EM), we used modified Jones model .the result shows the implementation IFRS have negatively effects on earning management.

Corporate governance and compliance with IFRS 7

2020 ◽  
Vol 35 (3) ◽  
pp. 448-474 ◽  
Author(s):  
Yosra Mnif ◽  
Oumaima Znazen
Keyword(s):  
Corporate Governance ◽  
Financial Reporting ◽  
Audit Committee ◽  
Stock Exchange ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Content Type ◽  
Ifrs 7 ◽  
The Impact ◽  
Mean Compliance

Purpose This paper aims to investigate the impact of the characteristics of two corporate governance mechanisms, namely, board of directors and audit committee (hereafter AC), on the level of compliance with International Financial Reporting Standard [hereafter International Financial Reporting Standards (IFRS)] 7 “Financial instruments: Disclosures” (hereafter FID). Design/methodology/approach Using a self-constructed checklist of 128 items, this research measures the compliance with IFRS 7 of 63 Canadian financial institutions listed on the Toronto Stock Exchange during a period of three years (2014-2016). Fixed effect panel regressions have been used to capture the individual effect present in authors’ data. Findings Empirical results show that the mean compliance level with IFRS 7 requirements is about 77 per cent and identify various areas of non-compliance. This level of compliance has a positive linkage with the board size and independence. Similarly, the AC independence and financial accounting expertise are shown to positively affect authors’ dependent variable. Nevertheless, CEO/chairman duality, AC size and meeting frequency are not significantly correlated with the level of compliance with IFRS 7. Originality/value This study expands prior compliance literature in the Canadian setting by examining the determinants of compliance with IFRS mandatory disclosures. Also, and to the best of the authors’ knowledge, this paper is among the first studies that have investigated the effect of corporate governance characteristics (hereafter CGC) on compliance with all IFRS 7 requirements in general.

scholarly journals Compliance With International Financial Reporting Standards and Value Relevance of Accounting Information in South Africa

2021 ◽  
Vol 12 (4) ◽  
pp. 277
Author(s):  
Unity Maqeda Putsai ◽  
Msizi Mkhize
Keyword(s):  
South Africa ◽  
Financial Reporting ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Positive Association ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Significant Positive Association ◽  
Compliance Level

The objective of the study is to investigate the relationship between the International Financial Reporting Standard (IFRS 1) and the value relevance (VR) of accounting information. In this study forty-six companies listed on the Johannesburg Stock Exchange during the period 1993 to 2017. Panel data is used to compare the period before and after IFRS. The companies in the sample are composed of the following sectors; mining, manufacturing, banks and investment companies, real estate, general industry, retailers, construction and material, chemical and software, and computers. Based on the yearly financial reports published by public companies in South Africa, the study employed the Cookes (1992) Unweighted Disclosure Index to measure the level of compliance in South Africa. Fifty-six disclosure elements from IFRS 1 were utilized to measure the compliance level. Thereafter Ohlson (1995) Model is used with dummy variables to compare the pre-and post-IFRS period. First, the study reflected that most of the South African companies exhibit higher compliance rates ranging from 87 to 93.417 which is impressive. On the other hand, 4 companies recorded Medium level compliance that is between 60% to 79% compliance level. The findings further revealed that there is a significant positive association between compliance with IFRS 1 and the value relevance of accounting information.

PENGARUH ADOPSI IFRS TERHADAP AUDIT DELAY PADA PERUSAHAAN YANG TERDAFTAR DI BURSA EFEK INDONESIA

2014 ◽  
Vol 10 (1) ◽  
pp. 15
Author(s):  
Tegangatin Tegangatin ◽  
Christine Novita Dewi
Keyword(s):  
Regression Analysis ◽  
Empirical Evidence ◽  
Financial Reporting ◽  
Stock Exchange ◽  
Total Sample ◽  
Policy Options ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Financial Report ◽  
Ifrs Adoption

This paper provides empirical evidence to answer the concern of business professional due to The Indonesian Institute of Accountants (IAI) officially stated that Indonesia would fully adopt the International Financial Reporting Standard (IFRS) in 2012. The implementation of IFRS has its various complications to companies depending the type of industry and transaction, financial report element and accounting policy options and that would be influence in delaying audit report. Therefore, this research aims to empirically test the influence of IFRS adoption towards audit delay. The methodology of this research is using regression analysis. Population used in this research is manufacturing and financial companies that are listed in Jakarta Stock Exchange (JSX) in the period of 2009-2013. From the population, selected sample based on criteria, resulted 110 samples per year or total sample of 440 companies. Through Eview, no relation is found between IFRS adoption and audit delay. This suggests that both management and auditor have been prepared well in implementing IFRS. Keywords: Audit Delay, IFRS Adoption

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