1,721,001 research outputs found
Goodwill under IFRS: Relevance and disclosures in an unfavorable environment
Get PDFThe accounting treatment of purchased goodwill under IFRS has been severely criticized due to the extensive use of fair value accounting. The purpose of this study is to enrich the ongoing debate upon this issue by drawing attention to the market valuation implications of goodwill in a country outside the Anglo-Saxon accounting paradigm, where the application of fair value accounting has been seen as more problematic. The results indicate that, in the case of purchased goodwill, fair value accounting generates relevant accounting numbers but only in companies that comply highly with IFRS disclosure requirements
Transparency in Fair Value Accounting under IFRS: An Examination of Greek Listed Companies’ Level of Compliance with IFRS Goodwill Disclosure Requirements
No full textThe mandatory adoption of IFRS in 2005 by publicly held companies in the European Union is viewed as another step towards establishing a high quality and transparent business language for European companies. Currently many voices warn that it is meaningless to speak about high quality and transparent financial reporting unless the effective and consistent implementation of IFRS is ensured; especially in issues that involve fair value accounting. Despite the importance of disclosures in issues where fair value accounting is involved, there is little evidence about companies’ level of compliance with IFRS disclosure requirements in a mandatory environment. This study focuses on IFRS goodwill disclosures due to the fact that goodwill accounting under IFRS is heavily influenced by fair value accounting. Specifically, using a content analysis method it examines compliance with IFRS 3 and IAS 36 for companies listed on the Athens Stock Exchange during the first four years of mandatory use of IFRS. Its findings show some potentially serious deficiencies in the implementation of IFRS disclosures for goodwill and mainly with those that are closely related to fair value accounting. Moreover, a particularly alarming finding of this study is that even after four years of IFRS introduction, Greek companies have not increased the volume of information that IAS 36 mandates. The findings of this study could be valuable for standard setters as well as for local enforcement mechanisms.</p
Financial performance of family versus non-family firms in the context of an economy in turmoil : A market from 'developed' to 'emerging'
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Integrated Reporting and the Informativeness of Financial Analysts' Stock Recommendations
No full textSynopsis The research problem The purpose of this study was to examine the market reaction to sell-side analyst recommendation revisions issued under an integrated reporting (IR) approach. Motivation Advocates of this corporate reporting approach argue that IR enhances capital markets' information environment by rendering investors better able to assess the value creation process of a firm. Recent empirical studies corroborate this argument. Considering the central role of financial intermediaries, we investigated whether the informativeness of analyst recommendation revisions is associated with the adoption of IR and the quality of integrated reports. The test hypotheses We tested whether the informativeness of analyst recommendation revisions decreases or increases after the mandatory adoption of an IR approach. Furthermore, we tested whether the informativeness is negatively or positively related to the quality of the released integrated report after the mandatory adoption of an IR approach. Target population We focused on the South African capital market, which is the only setting where IR is mandated. We utilized a sample of 3,201 recommendation revisions made within a 3-year window around the mandatory IR adoption. Adopted methodology This study used ordinary least square (OLS) regressions and applied difference-in-differences as well as instrumental variable approaches. Analyses We modeled the market reaction to the recommendation revisions as a function of the period in which the recommendations are announced (i.e., pre- or post-adoption), along with other factors affecting market reaction. In subsequent tests, we also modeled the market reaction to the recommendation revisions as a function of the quality of a firm's integrated report. Findings We found strong evidence that analysts' revisions exhibited economically and statistically significantly lower information content under IR. Moreover, we found that upgrades and downgrades issued in the post-adoption period were less informative when issued for firms with high-quality integrated reports. Overall, results showed that the benefit of acquiring advice from analysts became more marginal under an IR approach
Market valuation of greenhouse gas emissions under a mandatory reporting regime: Evidence from the UK
Get PDFThis study provides evidence on the potential benefits of mandatory environmental reporting for listed firms’ market valuation. It takes advantage of recent regulation that requires all listed firms in the UK to report their annual greenhouse gas (GHG) emissions in their annual reports and shows that the magnitude of the negative association between GHG emissions and the market value of listed firms decreased after the introduction of the reporting regulation. This decline is attributed to regulation forestalling shareholders’ negative reflexive reaction toward firms’ carbon disclosures, as proposed by the theoretical work of Unerman and O’Dwyer (2007)
Capital market consequences of integrated reporting: evidence from research analysts
No full textThe purpose of this study is to assess the market reaction to sell-side analysts’ recommendation revisions issued under an Integrated Reporting (IR) approach. The advocates of this new corporate reporting approach argue that IR enhances capital markets’ information environment by rendering investors better able to assess the value creation process of a firm. Recent empirical studies corroborate this argument. Considering the central role of financial intermediaries, we investigate whether the informativeness of analysts’ recommendation revisions is associated with the adoption of IR and the quality of integrated reports. We focus on the South African capital market which is the only setting where IR is mandated. Utilizing a sample of 2,636 recommendation revisions, we find strong evidence that analysts’ revisions exhibit economically and statistically significant lower information content under IR. Moreover, we find that upgrades and downgrades issued in the post-period are less informative when issued for firms with a high quality of integrated reports. These results are robust to a number of sensitivity analyses. Our findings have implications for capital market authorities as well as investors, considering that the benefit of acquiring advice from analysts becomes more marginal under an IR approach
Convergence of sustainability reporting standards for sustainable development:are salient institutions obliging?
No full textThis chapter examines the process and intricacies surrounding the convergence of sustainability reporting standards for sustainability and the role of salient institutions in facilitating this process. Further, it delves deeply into the concern and question of whether the salient institutions are indeed beneficial in achieving sustainability reporting standards convergence. Thus, this chapter employs a stakeholder salience model (SSM) and qualitative content analysis to categorise the salient institutions and how they contribute to the process of sustainability reporting standards convergence and its implications for sustainable development. Consequently, the chapter sheds light on the perspectives of the influential international institutions in achieving harmonised sustainability reporting standards and sustainable development. Particularly, the study reveals a self-centered approach among the influential international institutions, driven by political and profit motives, influenced by a lack of understanding of the true essence of ‘sustainability’. The chapter also highlights areas that require further research. <br/
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