scholarly journals The Difference between Stock Prices before and after Implementation of International Financial Reporting Standards

2017 ◽  
Vol 6 (4) ◽  
pp. 285
Author(s):  
Shu-Ling Hsu
Keyword(s):  
Financial Reporting ◽  
Capital Market ◽  
Stock Prices ◽  
Value Relevance ◽  
Financial Statements ◽  
Reporting Standards ◽  
Book Value ◽  
Financial Reporting Standards ◽  
Earnings Per Share ◽  
Before And After

Following the trend of capital market globalization, many countries have begun to use unified accounting standards. The resulting, financial statements are consistent and can thus attract foreign investment, and reduce the costs of multinational companies with regard to preparing financial statements. After the implementation of the International Financial Reporting Standards (IFRS), the earnings and book value of the shareholders’ equity are more relevant to stock prices, and this is also the case in Taiwan. Because the financial statements are different before and after incorporating IFRS, this has had a significant influence in the Taiwanese financial industry. This study analyzes and explains the impacts of the earnings and book value of equity on stock prices. We take a sample of financial firms in the years 2012 and 2013 for empirical research, and the results show that the earnings per share and book value of equity have a positive and significant impact on stock prices, with the earnings per share being most significant. The results also support the hypothesis proposed in this paper: There is a decline in the value relevance of earnings, but an increase in the value relevance of book value of shareholders’ equity, after implementation of IFRS. This implies the implementation of IFRS has valuable relevant information for capital market investments.

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.

Have financial statements lost their relevance? Empirical evidence from the frontier market of Kuwait

2016 ◽  
Vol 13 (2) ◽  
pp. 225-239 ◽  
Author(s):  
Mishari M. Alfraih
Keyword(s):  
Financial Reporting ◽  
Capital Market ◽  
Value Relevance ◽  
Stock Exchange ◽  
Financial Statements ◽  
Empirical Examination ◽  
Content Type ◽  
Book Value ◽  
Kuwait Stock Exchange ◽  
Reporting Environment

Purpose – Anecdotal concerns expressed regarding developed capital markets suggest that the information provided in financial statements has lost its value relevance to equity holders over time. The purpose of this paper is to investigate the issue from the perspective of Kuwait, which is a frontier market. Design/methodology/approach – Consistent with prior research, the design employs the price regression model. A total of 2,490 observations were collected from all firms listed on the Kuwait Stock Exchange (KSE) over a period of 21 years (1994-2014). Findings – Although this study documents a notable decline in both the value relevance of earnings and book value for equity holders over this period, the results suggest that the decline in the value relevance of earnings was deeper and more pronounced than that of book value. Practical implications – Because a fundamental prerequisite for the value relevance of accounting information is the quality of the financial reporting environment, the results are useful for regulators because they provide an assessment of the effectiveness of the current financial reporting environment. The results highlight the need for improvements because higher-quality information helps equity holders to determine value more precisely. As the timely dissemination of financial statements is an essential ingredient contributing to the relevance of financial statements, a direct implication of the study’s findings for the management of KSE companies is that timely reporting of financial statements may mitigate the observed decline of the value relevance of financial statements produced by KSE companies. Originality/value – This study contributes to the capital market research regarding changes in the value relevance of financial statement information through an empirical examination of a frontier capital market.

scholarly journals Disclosure of Subsidiaries with Non-controlling Interest in Accordance with IFRS 12: Case of Materiality

2016 ◽  
Vol 64 (1) ◽  
pp. 275-281 ◽  
Author(s):  
Tereza Gluzová
Keyword(s):  
Financial Reporting ◽  
Value Relevance ◽  
Stock Exchange ◽  
Financial Statements ◽  
Parent Company ◽  
Reporting Standards ◽  
Consolidated Financial Statements ◽  
Financial Reporting Standards ◽  
Disclosure Requirements ◽  
Definition Of

Consolidated financial statements present aggregated information for parent company and its subsidiaries. For non-wholly owned subsidiaries, International Financial Reporting Standards require non-controlling interest to be presented within consolidated equity to distinguish it from the amount of equity attributable to the shareholders of the parent. Since 2014, new standards on consolidation introduced broadened disclosure requirements for subsidiaries with material non-controlling interest. Definition of material non-controlling interest however is not included in the standards. The article provides the analysis of the financial statements published by companies listed on Prague Stock Exchange. Main focus is given to assessment criteria applied to identify material non-controlling interest. Consequently, study of compliance with the disclosure requirements for selected companies has been undertaken. The results of the analysis indicate whether value relevance of financial statements has been improved as a result of the new disclosures.

Analisis Perbedaan Earnings Response Coefficient (ERC) Sebelum dan Setelah Adopsi IFRS pada Perusahaan yang Tercatat dalam Bursa Efek Indonesia

MODUS ◽  
2016 ◽  
Vol 28 (1) ◽  
pp. 39
Author(s):  
Fransisca Intan Galantika ◽  
I Gede Siswantaya
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Financial Statements ◽  
Reporting Standards ◽  
Earnings Response Coefficient ◽  
Financial Reporting Standards ◽  
Response Coefficient ◽  
Significant Difference ◽  
Before And After ◽  
Earnings Response

AbstrakKonvergensi International Financial Reporting Standards (IFRS) menyebabkan Pernyataan Standar Akuntansi Keuangan (PSAK) mengalami beberapa perubahan. Perbedaan standar akuntansi keuangan menyebabkan komparibilitas laporan keuangan menurun sehingga investor dari berbagai negara sulit untuk mengambil keputusan investasi. Muncullah IFRS sebagai standar akutansi global sebagai acuan dalam menghasilkan pelaporan keuangan yang berkualitas. Penelitian ini bertujuan untuk melakukan analisis mengenai ada tidaknya perbedaan signifikan antara nilai Earning Response Coefficient (ERC) sebelum dan sesudah adopsi IFRS pada perusahaan yang tercatat di Bursa Efek Indonesia (BEI). ERC digunakan sebagai proksi untuk melihat reaksi pasar. Data yang digunakan dalam penelitian ini merupakan data sekunder berupa laporan keuangan tahunan dan harga saham bulanan. Sampel yang digunakan dalam penelitian ini adalah perusahaan yang terdaftar di BEI pada tahun 2009 hingga 2014. Pemilihan sampel didasarkan pada metode purposive sampling dengan kriteria yang telah ditentukan. Hasil penelitian ini membuktikan bahwa tidak terdapat perbedaan yang signifikan antara ERC sebelum dan sesudah adopsi IFRS ke dalam PSAK pada perusahaan yang terdaftar di BEI.Kata Kunci: IFRS, Earnings Response Coefficient, Laba, PSAK, Reaksi Pasar. Abstract Convergence of International Financial Reporting Standards (IFRS) causes the Pedoman Standar Akuntansi Keuangan (PSAK) undergo some changes. This then leads to differences in comparability of financial statements declining so that investors from various countries is difficult to make investment decisions. Then appeared IFRS as the global accounting standards as a reference in generating quality of financial reporting. This study aimed to analyze whether there was a significant difference between the value of Earning Response Coefficient (ERC) before and after the adoption of IFRS on the companies listed on the Indonesia Stock Exchange. ERC is used as a proxy to see the market reaction. The data used in this research is secondary data in the form of annual financial statements and monthly stock prices. The sample used in this study is a company listed on the Indonesia Stock Exchange (IDX) in 2009 to 2014. The sample selection was based on a random sampling method with predetermined criteria. The results of this study prove that there was no significant difference between the ERC before and after the adoption of IFRS into the FRS companies listed on the Stock Exchange.Keywords: IFRS, Earnings Response Coefficient, Earnings, PSAK, Market Reaction.

scholarly journals STUDI PUSTAKA RELEVANSI NILAI INFORMASI AKUNTANSI SEBELUM DAN SESUDAH PENERAPAN INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)

2015 ◽  
Vol 4 (4) ◽  
Author(s):  
Baiq Reinelda Tri Yunarni
Keyword(s):  
Financial Reporting ◽  
Value Relevance ◽  
Academic Research ◽  
Accounting Information ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Ifrs Adoption ◽  
Library Research

This study is a reviewof the academic research on value relevance of accountinginformationafter the application of International Financial Reporting Standards (IFRS)published in The Accounting Review in period of 2008-2012. The articles in those journalhave been selected in order to be relevantwith the purpose of this study, that is to determinethe changes (increases or decreases) the value relevanceof IFRS-based accountinginformation. This study uses library research method by collecting and reviewing 27articlesto be discussed qualitatively.Overall results of the review indicate that the adoption of IFRS has not been able toincrease the value relevance of accounting information. Application of IFRS can onlyincrease the international comparability of financial statements. The review also shows thatIFRS have not been able to reduce the level of company’s earnings management.Keywords : value relevance of accounting information, IFRS adoption, The Accounting Review

scholarly journals International Financial Reporting Standards and Value Relevance of Financial Information: An Empirical Evaluation of Selected Nigerian Listed Companies

2017 ◽  
Vol 1 (1) ◽  
pp. 1-11
Author(s):  
Auwalu Musa ◽  
Ibrahim Muhammad Tanimu
Keyword(s):  
Financial Reporting ◽  
Stock Price ◽  
Value Relevance ◽  
Listed Companies ◽  
Financial Information ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Net Income ◽  
Book Value ◽  
Financial Reporting Standards

This study investigates the International Financial Reporting Standards (IFRS) and value relevance of financial information among Nigerian listed companies after the adoption of IFRS. 77 sample companies were randomly selected from the population. Data were collected from UUM-Data stream through the annual reports and accounts of companies, which consist of Stock price (dependent variable), Book value of equity and net income as (independent variables) for the year 2016. Ordinary Least Square Regression was the method used in analyzing the variables. The regression result revealed that there is a positive and significant relationship between book value of equity and net income on stock price. These reveal that the financial information of listed companies in Nigeria is more value relevant after the adoption of IFRS. In view of the findings, the study recommends that, Nigerian Stock Exchange should ensure that all listed companies are comply with the accounting framework issued by IFRS, in order to have full disclosure of their financial information.

scholarly journals International Financial Reporting Standards Adoption and Value Relevance of Financial Information of Quoted Healthcare Firms in Nigeria

2018 ◽  
Vol 5 (4) ◽  
pp. 174
Author(s):  
Taibat A. Atoyebi ◽  
Yinka M. Salaudeen ◽  
Jerry Y. A. Onyilokwu
Keyword(s):  
Financial Reporting ◽  
Asset Management ◽  
Value Relevance ◽  
Financial Information ◽  
Share Price ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Earnings Per Share ◽  
The Impact

International Financial Reporting Standards (IFRS) was first adopted in 2005 by European Union countries while Nigeria mandatorily adopted in 2012 to participate in opportunities offered by globalization. This study, therefore, investigated the impact of IFRS adoption on the value relevance of financial information of quoted Healthcare Firms in Nigeria. The study conducted a pre (2008-2011) and post (2012-2015) IFRS analyses on six Healthcare firms quoted on the Nigeria Stock Exchange. The study sourced data on Earnings per Share (EPS), Change in Earnings per Share (CEPS), Book Value per Share (BVPS) and Share Price (SP) from published annual reports of the quoted Healthcare firms and Cashcraft Asset Management. Using the Multiple regression model the study revealed that Pre- IFRS financial information is value relevant; Post-IFRS financial information is also value relevant; and Post-IFRS financial information has relative value relevance over Pre- IFRS financial information.

scholarly journals Earning Management Analysis before and after Implementation of International Financial Reporting Standards (IFRS): Empirical Study of Automotive and Components Companies Registered on the IDX

2019 ◽  
Vol 1 (01) ◽  
pp. 45-56
Author(s):  
I Wayan Wisnu Utama ◽  
Anis Purwanti
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Management Practices ◽  
Stock Exchange ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Reporting Standard ◽  
Financial Reporting Standards ◽  
Before And After

  The issue of the application of IFRS as a standard can encourage a decrease in the level of earnings management in a company so that the application of IFRS in financial statements has the purpose of providing reports that are faithful in nature so that the report users are reliable. The purpose of this study is to show a comparison of earnings management practices that occurred before and after the implementation of International Financial Reporting Standards (IFRS) in Automotive and Component companies registered in the Indonesia Stock Exchange (IDX) for the period of 2009-2014. The data used in this study are secondary data in the form of the company’s financial statements. The variables in this study are earnings management before and after IFRS implementation. The sampling method in this study was purposive sampling with a sample of 12 automotive and component companies on the Indonesia Stock Exchange. Discretionary accruals of Modified Jones Model is used to measure the earnings management. The analytical method used for hypothesis testing is Paired Sample T-test, a different test for two paired samples. The results of this study indicate that earnings management in the period after IFRS convergence was different than earnings management in the period before IFRS convergence in Automotive and Component companies. However, IFRS convergence has not guaranteed a decline in earnings management practices in Automotive and Component companies.  Keywords: Earnings Management, International Financial Reporting Standard, Discretionary Accrual

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.

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