Template-Type: ReDIF-Article 1.0 Author-Name: Judy Day Author-X-Name-First: Judy Author-X-Name-Last: Day Author-Name: Peter Taylor Author-X-Name-First: Peter Author-X-Name-Last: Taylor Title: Accession to the European Union and the Process of Accounting and Auditing Reform Journal: Accounting in Europe Pages: 3-21 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379194 File-URL: http://hdl.handle.net/10.1080/09638180500379194 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:3-21 Template-Type: ReDIF-Article 1.0 Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Author-Name: Guenther Gebhardt Author-X-Name-First: Guenther Author-X-Name-Last: Gebhardt Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Roberto Di Pietra Author-X-Name-First: Roberto Author-X-Name-Last: Di Pietra Author-Name: Araceli Mora Author-X-Name-First: Araceli Author-X-Name-Last: Mora Author-Name: Frank Thinggård Author-X-Name-First: Frank Author-X-Name-Last: Thinggård Author-Name: Petri Vehmanen Author-X-Name-First: Petri Author-X-Name-Last: Vehmanen Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Title: Problems and Opportunities of an International Financial Reporting Standard for Small and Medium-sized Entities. The EAA FRSC's Comment on the IASB's Discussion Paper Abstract: Abstract In June 2004 the IASB issued the Discussion Paper ‘Preliminary Views on Accounting Standards for Small and Medium-Sized Entities’. This invited comments on the central question of whether the IASB should develop separate standards for small and medium-sized enterprises (SMEs), and on further issues and questions arising from this. This paper briefly introduces the background to the publication of the Discussion Paper. This is followed by a review of prior literature on SME financial reporting implications, prepared by the European Accounting Association's Financial Reporting Standards Committee as the basis of its response to the Discussion Paper. The paper concludes with a brief summary of events and issues arising since the end of the consultation period. Journal: Accounting in Europe Pages: 23-45 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500378949 File-URL: http://hdl.handle.net/10.1080/09638180500378949 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:23-45 Template-Type: ReDIF-Article 1.0 Author-Name: Mary Tokar** Author-X-Name-First: Mary Author-X-Name-Last: Tokar** Title: Convergence and the Implementation of a Single Set of Global Standards: The Real-life Challenge* Journal: Accounting in Europe Pages: 47-68 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379079 File-URL: http://hdl.handle.net/10.1080/09638180500379079 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:47-68 Template-Type: ReDIF-Article 1.0 Author-Name: Jens Wüstemann Author-X-Name-First: Jens Author-X-Name-Last: Wüstemann Author-Name: Sonja Kierzek Author-X-Name-First: Sonja Author-X-Name-Last: Kierzek Title: Revenue Recognition under IFRS Revisited: Conceptual Models, Current Proposals and Practical Consequences Abstract: Abstract Since 2002, the FASB and the IASB have been undertaking a joint project on the revision and convergence of US GAAP and IFRS revenue recognition. Even though the outcome of the project is still open, the project's course as well as trends in recently published IFRS and other current IASB projects suggest that existing earnings-based and realisation-based IFRS revenue recognition criteria are likely to be replaced by a radically new approach. This paper demonstrates the inconsistencies in current IFRS revenue recognition that have triggered the project and then presents and discusses three conceptually different revenue recognition models that are internationally debated at present. The paper concludes that a major revision of existing IFRS revenue recognition as proposed by the FASB and the IASB is not required. It is argued that the perceived deficiencies should rather be solved on the basis of current transaction-based IFRS revenue criteria. Journal: Accounting in Europe Pages: 69-106 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379111 File-URL: http://hdl.handle.net/10.1080/09638180500379111 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:69-106 Template-Type: ReDIF-Article 1.0 Author-Name: Thi Hong Phu Dao Author-X-Name-First: Thi Author-X-Name-Last: Hong Phu Dao Title: Monitoring Compliance with IFRS: Some Insights from the French Regulatory System Abstract: Abstract European Union Regulation 1606/2002 is aimed at improving the quality of financial reporting and developing a single capital market in Europe. Nevertheless, these goals cannot necessarily be achieved solely by making a requirement for EU companies to use International Financial Reporting Standards (IFRS), and the EU has sought to create a mechanism to oversee the appropriate application of these standards. In this paper, we describe and comment on the methods used by the French stock exchange regulator, the Autorité des Marchés Financiers (AMF), for monitoring compliance with the national reporting rules as this bears upon the issue of enforcement of IFRS in Europe as from 2005. The AMF has been chosen in our study because of its extensive experience with the review of financial statements of listed companies. Our paper draws on qualitative interviews with people involved directly in scrutinizing financial information at the AMF as well as on the experience gained from attachment to the AMF's Accounting Division. While there is recent research that addresses the issues on enforcement of accounting standards, there is still a lack of studies which discuss the relevance and effectiveness of the methods used to monitor compliance with accounting standards. Our paper may be of interest to different groups of participants including regulatory oversight bodies, auditors, producers and users of financial information in the capital markets. Journal: Accounting in Europe Pages: 107-135 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500378980 File-URL: http://hdl.handle.net/10.1080/09638180500378980 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:107-135 Template-Type: ReDIF-Article 1.0 Author-Name: Pascale Delvaille Author-X-Name-First: Pascale Author-X-Name-Last: Delvaille Author-Name: Gabi Ebbers Author-X-Name-First: Gabi Author-X-Name-Last: Ebbers Author-Name: Chiara Saccon Author-X-Name-First: Chiara Author-X-Name-Last: Saccon Title: International Financial Reporting Convergence: Evidence from Three Continental European Countries Abstract: Abstract Listed companies in the European Union are required to apply International Financial Reporting Standards (IFRS) in their consolidated accounts as of 1 January 2005. The purpose of this paper is to compare developments in France, Germany and Italy and the approaches to integrate the current European accounting reform processes with IFRS. The paper evaluates the adaptation of national accounting systems with respect to institutional and regulatory changes on the one hand and financial reporting changes on the other. Journal: Accounting in Europe Pages: 137-164 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379103 File-URL: http://hdl.handle.net/10.1080/09638180500379103 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:137-164 Template-Type: ReDIF-Article 1.0 Author-Name: T. Colwyn Jones Author-X-Name-First: T. Author-X-Name-Last: Colwyn Jones Author-Name: Robert Luther Author-X-Name-First: Robert Author-X-Name-Last: Luther Title: Anticipating the Impact of IFRS on the Management of German Manufacturing Companies: Some Observations from a British Perspective Abstract: Abstract The introduction of International Financial Reporting Standards (IFRS) in 2005 marked a significant departure from Germany's traditional financial accounting practices. This paper questions whether this change may have consequential effects on the distinctive traditional management accounting practices in the field of Controlling. We examine the possible impact on manufacturing companies drawing upon perceptions and expectations of managers in three Bavarian companies and two management consultancy firms. We consider whether financial accounting will assume an increased importance within firms, and whether this may lead to abandonment of some traditional management accounting practices and the adoption of different techniques in internal reporting compatible with the new IFRS regime for external reporting. This prompts consideration of whether such changes would lead to financial accounting domination of management accounting in Germany analogous to that argued by Johnson and Kaplan in 1987 in their ‘Relevance Lost’ thesis. We conclude that, at this juncture in the development of their information systems, German managers face an important choice between integrating external and internal reporting in ways that might fundamentally change established Controlling practices, or of continuing to operate dual accounting systems in much the same way as in the past so that adoption of IFRS is restricted to external reporting. Journal: Accounting in Europe Pages: 165-193 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379160 File-URL: http://hdl.handle.net/10.1080/09638180500379160 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:165-193 Template-Type: ReDIF-Article 1.0 Author-Name: Ester Oliveras Author-X-Name-First: Ester Author-X-Name-Last: Oliveras Author-Name: Xavier Puig Author-X-Name-First: Xavier Author-X-Name-Last: Puig Title: The Changing Relationship between Tax and Financial Reporting in Spain Abstract: Abstract The operational connection between tax and financial reporting has been reported on in detail for a few countries but not for Spain. However, the literature suggests that there was a great reduction in the influence of tax in Spain in the early 1990s. This paper applies the methodology of earlier researchers in order to measure the tax/reporting linkages for Spain at three different dates. We find that Spain is intermediate between France/Germany and USA/UK in the degree of tax influence on financial reporting. We also find that the common belief in a major reduction in tax influence over time can be refuted. Journal: Accounting in Europe Pages: 195-207 Issue: 1 Volume: 2 Year: 2005 Month: 1 X-DOI: 10.1080/09638180500379020 File-URL: http://hdl.handle.net/10.1080/09638180500379020 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:2:y:2005:i:1:p:195-207 Template-Type: ReDIF-Article 1.0 Author-Name: Axel Haller Author-X-Name-First: Axel Author-X-Name-Last: Haller Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Editorial Journal: Accounting in Europe Pages: 3-4 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600990049 File-URL: http://hdl.handle.net/10.1080/09638180600990049 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:3-4 Template-Type: ReDIF-Article 1.0 Author-Name: David Cairns Author-X-Name-First: David Author-X-Name-Last: Cairns Title: The Use of Fair Value in IFRS Abstract: ABSTRACT The implementation of International Financial Reporting Standards (IFRS), particularly in the European Union, has led to frequent comments that IFRS are "fair value based standards" and that the IASB is moving inexorably towards full fair value accounting. This article examines the extent to which IFRS do, in fact, require the use of fair values for the measurement of assets and liabilities. It explains the definition of fair value in IFRS, the evolution of that definition and the need for further clarifications and guidance with respect to the application of the definition. It then identifies the four main uses of fair value in IFRS. Three of these uses reflect what should have happened under many national standards. The fourth use is, in practice, restricted to very few assets and liabilities. The article concluded with suggestions about the possible areas in which the IASB might extend the use of fair values. Journal: Accounting in Europe Pages: 5-22 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920053 File-URL: http://hdl.handle.net/10.1080/09638180600920053 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:5-22 Template-Type: ReDIF-Article 1.0 Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Title: International Accounting Regulation and IFRS Implementation in Europe and Beyond -- Experiences with First-time Adoption in Europe Journal: Accounting in Europe Pages: 23-26 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920087 File-URL: http://hdl.handle.net/10.1080/09638180600920087 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:23-26 Template-Type: ReDIF-Article 1.0 Author-Name: Henry Rees Author-X-Name-First: Henry Author-X-Name-Last: Rees Title: The IASB's Proposed Amendments to IAS 371 Journal: Accounting in Europe Pages: 27-34 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920103 File-URL: http://hdl.handle.net/10.1080/09638180600920103 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:27-34 Template-Type: ReDIF-Article 1.0 Author-Name: Frank Thinggaard Author-X-Name-First: Frank Author-X-Name-Last: Thinggaard Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Author-Name: GüNther Gebhardt Author-X-Name-First: GüNther Author-X-Name-Last: Gebhardt Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Roberto Di Pietra Author-X-Name-First: Roberto Author-X-Name-Last: Di Pietra Author-Name: Araceli Mora Author-X-Name-First: Araceli Author-X-Name-Last: Mora Author-Name: Ken Peasnell Author-X-Name-First: Ken Author-X-Name-Last: Peasnell Title: Performance Reporting -- The IASB's Proposed Formats of Financial Statements in the Exposure Draft of IAS 1 Abstract: ABSTRACT This paper is a response to the exposure draft of proposed amendments to IAS 1 Presentation of Financial Statements published by the International Accounting Standards Board (IASB) in March 2006. The objective is to bring to the standard setter's attention research that is relevant to the issues raised in the exposure draft. We review analytic, empirical and experimental research that addresses the presentation of income and the format of the income statement. Overall, there is some support for a single statement of (total) recognised income and expense. However, net income is on average more relevant than comprehensive income, which may favour a two-statement approach. While this result is in line with the IASB's option of the two formats, it does not support the IASB's preference for a single statement. Journal: Accounting in Europe Pages: 35-63 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920152 File-URL: http://hdl.handle.net/10.1080/09638180600920152 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:35-63 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Title: Legal Certainty, European-ness and Realpolitik Abstract: ABSTRACT The stimulus for this paper is an article published in 2005 by Wüstemann and Kierzek together with a critical comment thereon by Nobes in 2006. The original paper discusses the IFRS proposals, and the philosophy they represent, concerning revenue recognition. Nobes, in terms which this author broadly supports, criticises their revenue recognition proposals in some detail, together, again rightly, with some of their assumptions. This paper, rather than reopening these specific issues, considers the explicit statement, for example, p. 71, and elsewhere, that there is a 'requirement of legal certainty in the European Union', a statement which is given neither logical justification nor supporting references. IAS, EU requirements and GoB as a national concept are all argued to be flexible, judgemental and, necessarily and permanently, devoid of 'legal certainty'. Implications of this analysis for regulation, harmonisation and for educational programmes in today's global environment are considered. Journal: Accounting in Europe Pages: 65-80 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920194 File-URL: http://hdl.handle.net/10.1080/09638180600920194 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:65-80 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher W. Nobes Author-X-Name-First: Christopher W. Author-X-Name-Last: Nobes Title: Revenue Recognition and EU Endorsement of IFRS Abstract: Abstract This paper comments on a previous paper in this journal concerning EU endorsement of IFRS. It is suggested here that the previous authors should consider whether there can be more than one true and fair view even in one country and especially across European countries. It is further suggested that the previous analysis of five accounting standards does not support the claim that the European Commission wrongly endorsed them. It is also argued here that the previous analysis of the nature of most gains under IFRS is faulty. Journal: Accounting in Europe Pages: 81-89 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920210 File-URL: http://hdl.handle.net/10.1080/09638180600920210 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:81-89 Template-Type: ReDIF-Article 1.0 Author-Name: Jens Wüstemann Author-X-Name-First: Jens Author-X-Name-Last: Wüstemann Author-Name: Sonja Kierzek Author-X-Name-First: Sonja Author-X-Name-Last: Kierzek Title: True and Fair View Revisited -- A Reply to Alexander and Nobes Abstract: Abstract This paper is a response to the critical comments of Alexander (2006) and Nobes (2006) on our article on revenue recognition, which was published last year in this journal (Wüstemann and Kierzek, 2005). While Alexander primarily objects to our statement that there is a 'requirement of legal certainty in the European Union', Nobes challenges our interpretation of the true and fair view principle and its role in the endorsement and application of International Financial Reporting Standards (IFRS) in the EU. We rebut Alexander's objections by providing references, which evidence that the principle of legal certainty represents a fundamental concept of Community law. We refute Nobes' counterarguments by inferring from the objective of the IAS Regulation and the purpose of the endorsement mechanism that a common meaning of the true and fair view principle must exist in the EU, that IFRS should only become applicable in the EU if they are not contrary to this 'European' true and fair view principle and that the true and fair view principle should also be considered in the application of IFRS in the EU, particularly in the choice of accounting policies for unregulated issues. Journal: Accounting in Europe Pages: 91-116 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920236 File-URL: http://hdl.handle.net/10.1080/09638180600920236 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:91-116 Template-Type: ReDIF-Article 1.0 Author-Name: Sally Aisbitt Author-X-Name-First: Sally Author-X-Name-Last: Aisbitt Title: Assessing the Effect of the Transition to IFRS on Equity: The Case of the FTSE 100 Abstract: ABSTRACT The paper presents the results of an analysis of the reconciliations of equity presented as part of the transition from UK Generally Accepted Accounting Principles (UK GAAP) to International Financial Reporting Standards (IFRS) by the largest UK companies. While the overall effect on equity is not significant, the effect of the change in convention on individual line items could have important consequences for financial analysis and contractual obligations. The level of variability between companies means that this change will demand attention to detail by users of financial statements. The paper provides a benchmark for comparison with companies from other accounting traditions making the transition to IFRS. Journal: Accounting in Europe Pages: 117-133 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920293 File-URL: http://hdl.handle.net/10.1080/09638180600920293 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:117-133 Template-Type: ReDIF-Article 1.0 Author-Name: Katalin Borbély Author-X-Name-First: Katalin Author-X-Name-Last: Borbély Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Title: A Matter of Principle: Recent Developments in Hungarian Accounting Thought and Regulation Abstract: ABSTRACT This paper provides, against a review of prior literature on the problems faced by economies in transition from plan to market, an analysis of developments in Hungarian accounting regulation during the past 15 years. Significant legislative events are examined, as well as gradually shifting attitudes of the key players involved in the regulatory processes. We identify a number of obstacles to the development of a regulatory framework suitable to provide decision-useful accounting information, among which the roles and attitudes of the legislator and the accounting profession feature prominently, as well as the lingering influence of taxation on accounting, and of other Continental European, code-law regulatory and accounting features. We conclude that a reduction of the influence of government and legislation is required, as well as a more progressive approach in the education and training of accountants. This should focus on the teaching of a new way of thinking and move away from the traditional teaching of detailed accounting methods. Journal: Accounting in Europe Pages: 135-168 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920335 File-URL: http://hdl.handle.net/10.1080/09638180600920335 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:135-168 Template-Type: ReDIF-Article 1.0 Author-Name: Abe De Jong Author-X-Name-First: Abe Author-X-Name-Last: De Jong Author-Name: Miguel Rosellón Author-X-Name-First: Miguel Author-X-Name-Last: Rosellón Author-Name: Patrick Verwijmeren Author-X-Name-First: Patrick Author-X-Name-Last: Verwijmeren Title: The Economic Consequences of IFRS: The Impact of IAS 32 on Preference Shares in the Netherlands Abstract: Abstract The consequences of international accounting standards are likely to reach beyond the impact on financial statements. This paper demonstrates one of the economic implications of international standards. We focus on the impact of the International Financial Reporting Standards (IFRS) regulation on preference shares (IAS 32) in the Netherlands. IAS 32 causes most preference shares to lose their classification as equity and these shares will hence be classified as liabilities. We document that for Dutch firms with preferred stock outstanding, the reclassification will on average increase the reported debt ratio by 35%. We find that 71% of the firms that are affected by IAS 32 buy back their preference shares or alter the specifications of the preference shares in such a way that the classification as equity can be maintained. The main determinant of the decision whether to give these consequences to IAS 32 is the magnitude of the impact of IAS 32 on a firm's debt ratio. We conclude that IFRS does not only lead to a decrease in the use of financial instruments that otherwise would have added to the capital structure diversity, but also changes firms' real capital structure. Journal: Accounting in Europe Pages: 169-185 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920350 File-URL: http://hdl.handle.net/10.1080/09638180600920350 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:169-185 Template-Type: ReDIF-Article 1.0 Author-Name: Thorsten Sellhorn Author-X-Name-First: Thorsten Author-X-Name-Last: Sellhorn Author-Name: Sylwia Gornik-Tomaszewski Author-X-Name-First: Sylwia Author-X-Name-Last: Gornik-Tomaszewski Title: Implications of the 'IAS Regulation' for Research into the International Differences in Accounting Systems Abstract: Abstract Meek and Thomas (2004) call for research on the continued relevance of 'rediscovered' dichotomous accounting classifications. We provide such evidence by examining how developments surrounding the 'IAS Regulation' (1606/2002) influenced international differences in accounting systems in the European Union. Since a sufficient time series of actual post-2005 International Financial Reporting Standards (IFRS) reporting practice is not yet observable, we propose an initial re-classification of accounting systems based on evidence available to date, that is, the degree of implementation of the IAS Regulation in the Member States. Consistent with Nobes (1998), we find that the degree of public accountability to outside investors (the 'public/private' criterion) is becoming the primary differentiator for accounting systems in Europe, surpassing country-level variables such as legal system and culture. The distinction between consolidated and individual financial statements is the second emerging differentiator. While consolidated accounting is becoming more uniform across countries, cross-country cultural differences are most likely to persist in individual accounting. Based on our analysis we highlight two important areas of future research beyond the consolidated financial statements of listed firms (e.g. Nobes, 2005; Schipper, 2005). First, at the country level, the interaction of IFRS and individual financial statements will need to be reassessed. In addition, research could help introduce a degree of differentiation into financial reporting regulation for unlisted firms, because these firms are not a homogeneous group. Also, the convergence of national GAAP systems with IFRS will benefit from fresh research insights. Second, at the firm level, future research could analyze the extent to which the determinants and consequences of IFRS adoption, an area well researched for publicly traded firms (e.g. Cuijpers and Buijink, 2005), generalize to unlisted firms. Such research will help detect emerging patterns of accounting systems within an international context. It will generate insights into the disconnect of consolidated accounts from national influences, the degree of uniformity of consolidated accounts among international firms, the continued relevance of traditional classifications of international accounting systems for individual accounts and accounts of unlisted companies, and the convergence of national standards with IFRS. Journal: Accounting in Europe Pages: 187-217 Issue: 1 Volume: 3 Year: 2006 Month: 10 X-DOI: 10.1080/09638180600920392 File-URL: http://hdl.handle.net/10.1080/09638180600920392 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:3:y:2006:i:1:p:187-217 Template-Type: ReDIF-Article 1.0 Author-Name: Stephen Cooper Author-X-Name-First: Stephen Author-X-Name-Last: Cooper Title: Performance Measurement for Equity Analysis and Valuation1 Abstract: Abstract This paper comments on the IASB/FASB project on financial statement presentation. It suggests that the basic approach of cohesiveness between statements is worthwhile and the split between operating, financing and investing is useful to investors. However it proposes different valuation and presentation approaches for different activities, and underlines the importance of earnings for forecasting comprehensive income. It suggests a conceptual approach to defining earnings and explores ways of avoiding recycling while identifying fair value changes for some assets and liabilities. Journal: Accounting in Europe Pages: 1-49 Issue: 1 Volume: 4 Year: 2007 Month: 6 X-DOI: 10.1080/17449480701491430 File-URL: http://hdl.handle.net/10.1080/17449480701491430 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:1:p:1-49 Template-Type: ReDIF-Article 1.0 Author-Name: Andrew Lennard Author-X-Name-First: Andrew Author-X-Name-Last: Lennard Title: Stewardship and the Objectives of Financial Statements: A Comment on IASB's Preliminary Views on an Improved Conceptual Framework for Financial Reporting: The Objective of Financial Reporting and Qualitative Characteristics of Decision-Useful Financial Reporting Information1 Abstract: Abstract This paper examines the question of whether the objective of financial reporting should be based solely on ‘decision-usefulness’ or whether stewardship should be recognised as a separate objective. This question is not new, but has recently come to the fore through the publication by the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) of their ‘Preliminary Views’ (PV) paper setting out a draft of the first chapters of their proposed improved conceptual framework. The PV paper proposes a decision-useful objective, and argues that information relevant to assessing stewardship will be encompassed in that objective. However, two IASB members have set out an ‘Alternative View’ which argues that stewardship and decision-usefulness are parallel objectives with different emphases that should therefore be defined as separate objectives. The present paper argues that, as suggested by the Alternative View, stewardship contributes an important dimension to financial reporting, which should be reflected by specific acknowledgement in the objectives of financial reporting. However, it suggests that stewardship should not be characterised simply as information to assist an assessment of the competence and integrity of ‘stewards’ (i.e. management, directors) but as the provision of information that provides a foundation for a constructive dialogue between management and shareholders. Seen in this way, stewardship provides a direct support for many of the propositions advanced in the PV paper. For example, it highlights the importance of historical information and that information should be complete. It would, however, be easier to make a compelling case for this information if a major role for stewardship were identified in the framework, rather than being placed merely in a supporting role. But other consequences would also follow. Exclusive focus on a decision-usefulness objective has led to an excessive emphasis on the forecasting of future cash flows, and insufficient emphasis on reliability, which seems to be an essential qualitative characteristic of financial statements. The substitution of ‘verifiability’, as proposed by the PV paper, is not adequate. There is no conflict between decision-useful and stewardship objectives, since the information required to meet the objective of stewardship is required by decision-usefulness: however, the exclusion of stewardship incurs the risk that those who argue for the inclusion of information required for an assessment of stewardship will be placed at a disadvantage. They will have to frame their arguments in an indirect and convoluted way, and it is accordingly unlikely that they will always succeed. So accounting standards might permit the exclusion of information, or the presentation of information in a suboptimal way, whilst superior alternatives could be compellingly supported by appeal to an explicit objective of stewardship. Journal: Accounting in Europe Pages: 51-66 Issue: 1 Volume: 4 Year: 2007 Month: 6 X-DOI: 10.1080/17449480701308774 File-URL: http://hdl.handle.net/10.1080/17449480701308774 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:1:p:51-66 Template-Type: ReDIF-Article 1.0 Author-Name: Alicja Jaruga Author-X-Name-First: Alicja Author-X-Name-Last: Jaruga Author-Name: Justyna Fijalkowska Author-X-Name-First: Justyna Author-X-Name-Last: Fijalkowska Author-Name: Malgorzata Jaruga-Baranowska Author-X-Name-First: Malgorzata Author-X-Name-Last: Jaruga-Baranowska Author-Name: Maciej Frendzel Author-X-Name-First: Maciej Author-X-Name-Last: Frendzel Title: The Impact of IAS/IFRS on Polish Accounting Regulations and their Practical Implementation in Poland Abstract: Abstract In the face of the globalization process that we have witnessed over recent years, the European Union (EU) decided that it is crucial to improve the competitiveness of Europe and the development of financial services and capital markets through enforcement of International Financial Reporting Standards (IFRS) as a basis of financial reporting of listed companies. Poland as a member of the EU was obliged to incorporate International Accounting Standards (IAS)/IFRS in national accounting regulations. Our paper discusses this issue. We also present the impact of IAS/IFRS implementation by Polish companies on their financial statements, particularly the impact on income and equity (capital). The presentation is the result of the review and analysis of 255 financial reports (including 171 consolidated) of companies listed on the Warsaw Stock Exchange. Journal: Accounting in Europe Pages: 67-78 Issue: 1 Volume: 4 Year: 2007 Month: 6 X-DOI: 10.1080/17449480701308675 File-URL: http://hdl.handle.net/10.1080/17449480701308675 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:1:p:67-78 Template-Type: ReDIF-Article 1.0 Author-Name: Danuta Krzywda Author-X-Name-First: Danuta Author-X-Name-Last: Krzywda Author-Name: Marek Schroeder Author-X-Name-First: Marek Author-X-Name-Last: Schroeder Title: An Analysis of the Differences between IFRS and Polish Accounting Regulations: Evidence from the Financial Statements of Listed Entities on the Warsaw Stock Exchange for the Calendar Years Ending 2001, 2003 and 2004 Abstract: Abstract An analysis of the qualitative and quantitative data on the differences between Polish accounting regulations and International Financial Reporting Standards (IFRS) reported by the preparers of the financial statements of a sample of listed entities on the Warsaw Stock Exchange for the years ending 31 December 2001, 2003 and 2004 revealed that owners' equity and post tax earnings calculated using Polish accounting regulations were materially understated in comparison with their IFRS equivalents. The book value of owners' equity for 2004 calculated using Polish accounting regulations was understated by an average of between 6 and 9% while post tax earnings for 2004 were understated by an average of 35%. The main reasons for the differences were that Polish accounting regulations do not allow regular revaluations of tangible fixed assets, require different accounting treatments of positive and negative goodwill on consolidation and allow in certain circumstances the exclusion of subsidiaries from full consolidation. Journal: Accounting in Europe Pages: 79-107 Issue: 1 Volume: 4 Year: 2007 Month: 6 X-DOI: 10.1080/17449480701343060 File-URL: http://hdl.handle.net/10.1080/17449480701343060 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:1:p:79-107 Template-Type: ReDIF-Article 1.0 Author-Name: Michael Bradbury Author-X-Name-First: Michael Author-X-Name-Last: Bradbury Title: An Anatomy of an IFRIC Interpretation Abstract: Abstract This article provides an anatomy of an International Financial Reporting Interpretation Committee (IFRIC) Interpretation. That is, it describes the IFRIC's current operating procedures. It also describes the IFRIC's outputs from its inception in March 2002 to March 2007. During this period the IFRIC produced 14 Final Interpretations, 20 Draft interpretations and 120 “rejection notices” (i.e., issues that were considered by IFRIC but not included on the agenda). Reasons for the agenda rejections are summarized in the paper. Journal: Accounting in Europe Pages: 109-122 Issue: 2 Volume: 4 Year: 2007 Month: 12 X-DOI: 10.1080/17449480701727890 File-URL: http://hdl.handle.net/10.1080/17449480701727890 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:2:p:109-122 Template-Type: ReDIF-Article 1.0 Author-Name: Holger Erchinger Author-X-Name-First: Holger Author-X-Name-Last: Erchinger Author-Name: Winfried Melcher Author-X-Name-First: Winfried Author-X-Name-Last: Melcher Title: Convergence between US GAAP and IFRS: Acceptance of IFRS by the US Securities and Exchange Commission (SEC) Abstract: Abstract The world's capital markets stand to benefit significantly from widespread acceptance and use of global accounting standards that are high quality, comprehensive and rigorously applied. The US Securities and Exchange Commission (SEC) announced in April 2007 a series of actions it intends to take relating to the acceptance of International Financial Reporting Standards (IFRS). To implement this, the SEC proposed in July 2007 amendments to Form 20-F and conforming changes to SEC Regulation S-X to accept financial statements prepared in accordance with IFRS without reconciliation to US Generally Accepted Accounting Principles (GAAP) when contained in the filings of foreign private issuers with the SEC. This paper analyses the forces driving convergence between US GAAP and IFRS and discusses the most recent activities by the SEC in relation to IFRS and international cooperation, including the SEC vote as of 15 November 2007, to allow foreign private issuers to prepare their financial statements using IFRS as issued by the IASB without reconciling to US GAAP. Journal: Accounting in Europe Pages: 123-139 Issue: 2 Volume: 4 Year: 2007 Month: 12 X-DOI: 10.1080/17449480701727908 File-URL: http://hdl.handle.net/10.1080/17449480701727908 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:2:p:123-139 Template-Type: ReDIF-Article 1.0 Author-Name: Eva Eberhartinger Author-X-Name-First: Eva Author-X-Name-Last: Eberhartinger Author-Name: Margret Klostermann Author-X-Name-First: Margret Author-X-Name-Last: Klostermann Title: What if IFRS were a Tax Base? New Empirical Evidence from an Austrian Perspective Abstract: Abstract In particular in Germany and Austria, but also in other countries, extensive theoretical and analytical research has been published on the potential tax effects should International Financial Reporting Standards (IFRS) be used as the basis for corporate taxation. Very few quantitative papers exist. This motivated us to conduct a study that quantifies the actual effects of a potential decisiveness of IFRS for the national tax base -- without further questioning the usefulness of an IFRS relevance. Our paper extends existing research substantially. The research question of our paper deals with the measurement through simulation of differences in the discounted tax burden in various scenarios. Our sample comprises original data from 61 Austrian companies. The median of the difference between book values of IFRS single accounts and tax accounts for specific balance sheet items is determined. We then apply the result to the items of a typical corporate account derived from an Austrian database. As a result, depending on the term of items, we can calculate the discounted tax effects for different scenarios. It must be underlined that such highly confidential and detailed tax data is usually not available to researchers. The main preliminary finding of our empirical survey is that only in a few cases we find essential differences between IFRS and tax accounts. Our evidence suggests that no dramatic change in the tax base is to be expected. Our study provides not only new empirical evidence but also a basis for further research on a possible common consolidated corporate tax base from an academic perspective. Journal: Accounting in Europe Pages: 141-168 Issue: 2 Volume: 4 Year: 2007 Month: 12 X-DOI: 10.1080/17449480701727932 File-URL: http://hdl.handle.net/10.1080/17449480701727932 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:2:p:141-168 Template-Type: ReDIF-Article 1.0 Author-Name: Ion Ionas¸cu Author-X-Name-First: Ion Author-X-Name-Last: Ionas¸cu Author-Name: Mihaela Ionas¸cu Author-X-Name-First: Mihaela Author-X-Name-Last: Ionas¸cu Author-Name: Lavinia Olimid Author-X-Name-First: Lavinia Author-X-Name-Last: Olimid Author-Name: Daniela Artemisa Calu Author-X-Name-First: Daniela Author-X-Name-Last: Artemisa Calu Title: An Empirical Evaluation of the Costs of Harmonizing Romanian Accounting with International Regulations (EU Directives and IAS/IFRS) Abstract: After the fall of communism, Romanian accounting has undergone several waves of reform. The first began with the 1991 Accounting Law and its 1993 Regulations implementing a French-inspired accounting chart and guidelines. The second wave of reform produced Regulations (in 1999 and 2001) for the harmonization of large entities' accounting with EU accounting directives and International Accounting Standards/International Financial Reporting Standards (IAS/IFRS). An interesting feature was the inclusion of IASB's conceptual framework into the text of these Regulations. Our study seeks to identify and evaluate the costs of harmonizing Romanian accounting with international regulations (EU Directives and IAS/IFRS). We hypothesize that three types of costs are prevalent: personnel training costs, consultants' fees and costs to adjust existing information systems. We also hypothesize that harmonization benefits are noticeable for those entities that make frequent use of foreign finance and for those entities with majority foreign shareholders. To collect data, we sent out questionnaires to the finance directors of listed Romanian companies. As full application of IAS/IFRS by non-financial companies has recently been postponed until 2007, we also comment on the benefits and costs of gradual reforms as opposite to a one-step adoption of IAS/IFRS. Journal: Accounting in Europe Pages: 169-206 Issue: 2 Volume: 4 Year: 2007 Month: 12 X-DOI: 10.1080/17449480701727965 File-URL: http://hdl.handle.net/10.1080/17449480701727965 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:2:p:169-206 Template-Type: ReDIF-Article 1.0 Author-Name: Robert K. Larson Author-X-Name-First: Robert K. Author-X-Name-Last: Larson Title: Constituent Participation and the IASB's International Financial Reporting Interpretations Committee Abstract: Abstract While international convergence of accounting standards is becoming more of a reality, the International Accounting Standards Board (IASB) continues to seek greater acceptance and legitimacy as an institution. Constituent participation is one key component for an organization to obtain legitimacy and success. This study investigates constituent participation of one significant part of the IASB, the International Financial Reporting Interpretations Committee (IFRIC). IASB/IFRIC constituents are classified in two ways: (1) geographically (by country and region); and (2) stakeholder interest group (the accounting profession, regulators, preparers and users). Respondents writing comment letters in regards to IFRIC's first 18 Draft Interpretations are examined. A total of 272 respondents from 40 countries generated 714 comment letters. The European Union provided a majority of writers and letters, with the UK being the largest contributor. The USA, Canada and developing countries generated few letters. Constituent participation significantly increased over IFRIC's predecessor committee, but responses remain concentrated with 35 respondents, mostly professional accountancy bodies and accounting standard-setters, generating 58% of the comment letters. Users accounted for only 5% of letters. While improved constituent participation may support the notion of increased legitimacy, limited participation by some IFRIC constituents suggests that the IASB should further promote constituent participation to achieve greater legitimacy. Journal: Accounting in Europe Pages: 207-254 Issue: 2 Volume: 4 Year: 2007 Month: 12 X-DOI: 10.1080/17449480701727981 File-URL: http://hdl.handle.net/10.1080/17449480701727981 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:4:y:2007:i:2:p:207-254 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: European Accounting Research -- A Comment Journal: Accounting in Europe Pages: 1-13 Issue: 1 Volume: 5 Year: 2008 Month: 6 X-DOI: 10.1080/17449480802088697 File-URL: http://hdl.handle.net/10.1080/17449480802088697 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:1:p:1-13 Template-Type: ReDIF-Article 1.0 Author-Name: Caroline Aggestam-Pontoppidan Author-X-Name-First: Caroline Author-X-Name-Last: Aggestam-Pontoppidan Title: A Global Forum for Accountancy Debates1 Abstract: Abstract This paper reports on the annual meeting in 2007 of the United Nations Intergovernmental Group of Experts on International Standards of Accounting and Reporting (UN-ISAR). The main item was a continuing discussion of the application of IFRS in a number of countries where further case studies had been done. The meeting also debated the IASB exposure draft on SMEs and compared that with the UN work in this field. A second main theme was guidance on corporate responsibility indicators in annual reports and a review of the implementation status of corporate governance disclosures. The UN group had also hosted a one-day conference on accounting in the extractive industries. Journal: Accounting in Europe Pages: 15-26 Issue: 1 Volume: 5 Year: 2008 Month: 6 X-DOI: 10.1080/17449480802049400 File-URL: http://hdl.handle.net/10.1080/17449480802049400 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:1:p:15-26 Template-Type: ReDIF-Article 1.0 Author-Name: Roberto Di Pietra Author-X-Name-First: Roberto Author-X-Name-Last: Di Pietra Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Author-Name: Jérôme Chevy Author-X-Name-First: Jérôme Author-X-Name-Last: Chevy Author-Name: Maurizio Cisi Author-X-Name-First: Maurizio Author-X-Name-Last: Cisi Author-Name: Brigitte Eierle Author-X-Name-First: Brigitte Author-X-Name-Last: Eierle Author-Name: Robin Jarvis Author-X-Name-First: Robin Author-X-Name-Last: Jarvis Title: Comment on the IASB's Exposure Draft ‘IFRS for Small and Medium-Sized Entities’1 Abstract: Abstract In February 2007 the IASB invited comments on its Exposure Draft of a proposed IFRS for Small and Medium-Sized Entities. The deadline for comments was 30 November 2007. Below we reproduce3 the comment letter prepared by the European Accounting Association's Financial Reporting Standards Committee (EAA FRSC). This is a follow up of the EAA FRSC's comment letter prepared in response to the IASB's Discussion Paper on ‘Preliminary Views on Accounting Standards for Small and Medium-Sized Entities’, published in 2005. Our comment is structured as follows: we initially sketch the background to the development of the Exposure Draft. We then revisit the key issues arising from our previous comment letter. This is followed by a survey of relevant literature published since the Discussion Paper. We then briefly address the questions raised by the IASB in the context of the Exposure Draft, before summarising the key issues arising from the literature which we consider relevant to the IASB's project. Journal: Accounting in Europe Pages: 27-47 Issue: 1 Volume: 5 Year: 2008 Month: 6 X-DOI: 10.1080/17449480802049392 File-URL: http://hdl.handle.net/10.1080/17449480802049392 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:1:p:27-47 Template-Type: ReDIF-Article 1.0 Author-Name: Sven Husmann Author-X-Name-First: Sven Author-X-Name-Last: Husmann Author-Name: Martin Schmidt Author-X-Name-First: Martin Author-X-Name-Last: Schmidt Title: The Discount Rate: A Note on IAS 36 Abstract: Abstract Entities reporting under IFRSs are required to determine a value in use in accordance with IAS 36: Impairment of Assets. The value in use is the present value of the expected future cash flows. Appendix A to the standard gives guidance on how to apply the DCF calculus in the context of IAS 36. In order to determine a suitable discount rate, the reporting entity is given the choice between three alternative starting points. The requirements of IAS 36 are, in this respect, quite different from the accounting requirements of US GAAP. In this paper we analyse these starting points and demonstrate the functional interrelation between them. Given that the interrelation is complex even under simple assumptions, we will provide guidance to practitioners as to which starting point should be used. We will demonstrate that the weighted average cost of capital (WACC) is the only suitable starting point. Based on this analysis, we also show that the other alternative starting points are not sufficiently clear. When used in practice, the guidance may even give rise to substantial measurement errors and make earnings management possible. Thus, our recommendation to the IASB is to shorten the guidance and delete the other two starting points. Journal: Accounting in Europe Pages: 49-62 Issue: 1 Volume: 5 Year: 2008 Month: 6 X-DOI: 10.1080/17449480802088762 File-URL: http://hdl.handle.net/10.1080/17449480802088762 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:1:p:49-62 Template-Type: ReDIF-Article 1.0 Author-Name: Nicolas Véron Author-X-Name-First: Nicolas Author-X-Name-Last: Véron Title: Fair Value Accounting is the Wrong Scapegoat for this Crisis Journal: Accounting in Europe Pages: 63-69 Issue: 2 Volume: 5 Year: 2008 Month: 12 X-DOI: 10.1080/17449480802510542 File-URL: http://hdl.handle.net/10.1080/17449480802510542 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:2:p:63-69 Template-Type: ReDIF-Article 1.0 Author-Name: Niclas Hellman Author-X-Name-First: Niclas Author-X-Name-Last: Hellman Title: Accounting Conservatism under IFRS Abstract: In a recent discussion paper on an improved conceptual framework (IASB, 2006a), the IASB and the FASB argue that prudence and conservatism are not desirable qualities of financial reporting information (IASB, 2006a, BC2.22). One interpretation of this proposal is that the consistent undervaluation of net assets (consistent conservatism), which used to be common under Continental European GAAPs and to some extent under US GAAP, is not considered to be an adequate way of dealing with uncertainty. Instead, the changes in the business conditions of a firm should be, to a greater extent, reflected in the financial reporting via changes in future-oriented estimates and probabilities. In turn, this should increase the decision relevance to users. However, although the boards suggest that the improved framework will not include prudence or conservatism as desirable qualities, this paper suggests that a more valid description is that consistently conservative accounting treatments will be replaced by accounting methods that leave more opportunities for temporary conservatism (changes in accounting estimates that temporarily understate net assets via the creation of hidden reserves which later may be reversed). From a user perspective, temporary conservatism is demanding because of the increased income-shifting between periods. This is illustrated in the paper by examining three cases concerning loss carryforwards, development costs and construction contracts, related to three different standards (IAS 12, IAS 38 and IAS 11, respectively). Furthermore, the paper illustrates how the mixing of consistent and temporary conservatism may lead to counter-intuitive interpretations of the underlying business activities that, in turn, make the information less relevant to users. Journal: Accounting in Europe Pages: 71-100 Issue: 2 Volume: 5 Year: 2008 Month: 12 X-DOI: 10.1080/17449480802510492 File-URL: http://hdl.handle.net/10.1080/17449480802510492 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:2:p:71-100 Template-Type: ReDIF-Article 1.0 Author-Name: Deborah Knirsch Author-X-Name-First: Deborah Author-X-Name-Last: Knirsch Author-Name: Rainer Niemann Author-X-Name-First: Rainer Author-X-Name-Last: Niemann Title: Deferred Shareholder Taxation -- Implementing a Neutral Business Tax in the European Union Abstract: This paper proposes the replacement of the corporate income tax by shareholder-based capital income taxation. Our proposal would guarantee investment neutrality of taxation and reduced tax compliance costs. The proposal is based on the S-base cash flow tax. Under the S-base tax, transactions within the corporate sector are not taxable and only transactions between shareholders and corporations are subject to tax. In contrast to existing S-base cash flow tax systems, tax deductibility of investments is deferred. Rather, the acquisition costs and capital endowments are compounded at the capital market rate and are set off against future capital gains. Dividends and withdrawals are fully taxable at the shareholder level. Because of the deferral of the tax payments our proposal is called ‘Deferred Shareholder Tax’ (DST). The DST exhibits the same neutrality properties as the traditional cash flow tax. Moreover, the compounded inter-temporal credit method ensures that it is neutral with respect to the decision between domestic and foreign investment. To increase acceptance of the DST, current taxpayers’ documentation requirements will be reduced rather than extended. Our proposal could be realised in a single EU country or in all member states of the EU. Journal: Accounting in Europe Pages: 101-125 Issue: 2 Volume: 5 Year: 2008 Month: 12 X-DOI: 10.1080/17449480802510518 File-URL: http://hdl.handle.net/10.1080/17449480802510518 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:2:p:101-125 Template-Type: ReDIF-Article 1.0 Author-Name: Ana Isabel Morais Author-X-Name-First: Ana Isabel Author-X-Name-Last: Morais Title: Actuarial Gains and Losses: the Choice of the Accounting Method Abstract: IAS 19: Employee Benefits (2004) enables a choice between three accounting methods of recognising actuarial gains and losses: profit or loss, equity and corridor methods. The objective of this paper is to identify the accounting method of actuarial gains and losses followed by companies after the mandatory adoption of International Accounting Standards Board (IASB) standards. Information was collected about that accounting method adopted by 523 European companies, in the first year of mandatory IASB standards adoption. It was found that most of European companies included in the sample adopted the corridor method or the equity recognition method. The results also show that the equity recognition method is more used in the United Kingdom (UK) and Ireland and the corridor method is more used by financial companies. Journal: Accounting in Europe Pages: 127-139 Issue: 2 Volume: 5 Year: 2008 Month: 12 X-DOI: 10.1080/17449480802510534 File-URL: http://hdl.handle.net/10.1080/17449480802510534 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:5:y:2008:i:2:p:127-139 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Editorial Journal: Accounting in Europe Pages: 1-1 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896528 File-URL: http://hdl.handle.net/10.1080/17449480902896528 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:1-1 Template-Type: ReDIF-Article 1.0 Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Author-Name: Anne Cazavan-Jeny Author-X-Name-First: Anne Author-X-Name-Last: Cazavan-Jeny Author-Name: Wolfgang Dick Author-X-Name-First: Wolfgang Author-X-Name-Last: Dick Author-Name: Chrystelle Richard Author-X-Name-First: Chrystelle Author-X-Name-Last: Richard Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Fair Value Accounting and the Banking Crisis in 2008: Shooting the Messenger Abstract: The paper sets out to analyse the effects of the financial crisis on the international standard-setter in 2008 and the attempts made to shoot the messenger -- to blame IAS 39 for creating the crisis for reporting unrealised losses, rather than the cause being bankers making bad investment decisions. It first provides a brief analysis of IAS 39 and fair value accounting for financial instruments. It then sets out the relationship with the Basel II banking regulatory regime. The main part of the paper is a chronological presentation of the events of 2008 as they impact upon the international standard-setting institution. In particular, we analyse the impact of the G20 requirements and the blunt intervention of the European Commission that led to amendments to IAS 39. The final part of the paper looks at the consequences as they are so far discernible and the damage done to the IASB by shooting the messenger. Journal: Accounting in Europe Pages: 3-24 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896346 File-URL: http://hdl.handle.net/10.1080/17449480902896346 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:3-24 Template-Type: ReDIF-Article 1.0 Author-Name: Bernard Colasse Author-X-Name-First: Bernard Author-X-Name-Last: Colasse Author-Name: Christine Pochet Author-X-Name-First: Christine Author-X-Name-Last: Pochet Title: The Genesis of the 2007 Conseil National de la Comptabilité: A Case of Institutional Isomorphism? Abstract: This article puts forward an interpretation of the reform of the French accounting standard-setter initiated by Decree no. 20076629 of 27 April 2007 relating to the national accounting standards board, the Conseil National de la Comptabilité (CNC). This reform, if it goes to term, will give birth to a French accounting standards authority, the Autorité des Normes Comptables (ANC). The proposed interpretation fits within a neo-institutionalist framework. In particular, it uses the notions of path dependency and institutional mimetism. The new CNC is first put into context as an institution in relation to its predecessors. It is then compared with two institutions, the architecture of which may have inspired its conception, the Financial Accounting Standards Board (FASB) and the Autorité des Marchés Financiers (AMF). It would appear that the new CNC clearly departs from the historical path traced by French accounting regulation and tends to mimic French autorités administratives indépendantes (independent administrative authorities) of the AMF type. However, such ‘authorities’ are strongly inspired by the American Securities and Exchange Commission (SEC). So paradoxically, the model of the new French Accounting Standards Authority would be a SEC rather than an FASB. Journal: Accounting in Europe Pages: 25-55 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896379 File-URL: http://hdl.handle.net/10.1080/17449480902896379 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:25-55 Template-Type: ReDIF-Article 1.0 Author-Name: Frédérique Déjean Author-X-Name-First: Frédérique Author-X-Name-Last: Déjean Author-Name: Isabelle Martinez Author-X-Name-First: Isabelle Author-X-Name-Last: Martinez Title: Environmental Disclosure and the Cost of Equity: The French Case Abstract: What is the impact of voluntary corporate environmental disclosures on the cost of equity? The present study will attempt to answer this question. The empirical research is based on companies listed in the French SBF 120 stock market index. In 2006, most of these companies devoted a section of their annual report to environmental actions, yet fewer than 20% of them actually published a separate report dedicated to the issue of sustainable development. Regardless of the selected medium, the environmental topics receiving the most attention in corporate reporting are pollution, natural resources and recycling. The determinants associated with environmental disclosure are: company size, financial leverage, and the number of financial analysts monitoring company stock. This study does not lead to concluding that companies disclosing environmental information necessarily lower the cost of equity. Journal: Accounting in Europe Pages: 57-80 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896403 File-URL: http://hdl.handle.net/10.1080/17449480902896403 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:57-80 Template-Type: ReDIF-Article 1.0 Author-Name: Bernard Gumb Author-X-Name-First: Bernard Author-X-Name-Last: Gumb Author-Name: Christine Noël Author-X-Name-First: Christine Author-X-Name-Last: Noël Title: CEOs' Reports about Internal Control: A Content Analysis Abstract: This article is about internal control as perceived by CEOs of French firms listed in the CAC 40 index. While the American regulator recommends COSO, French law prescribes no particular framework for the required report. Thus, management has more freedom, which should lead to more diversity of the content, and therefore more richness for lexical content analysis. The latter certainly confirms some trends identified by previous works (e.g. the importance of the risk topic and the financial dimension), but it also shows the shareholder-oriented notion of internal reports. Such a work, based on disclosures published in 2005, should extend former surveys and prefigure further researches. Journal: Accounting in Europe Pages: 81-106 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896478 File-URL: http://hdl.handle.net/10.1080/17449480902896478 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:81-106 Template-Type: ReDIF-Article 1.0 Author-Name: Thomas Jeanjean Author-X-Name-First: Thomas Author-X-Name-Last: Jeanjean Author-Name: Carlos Ramirez Author-X-Name-First: Carlos Author-X-Name-Last: Ramirez Title: Back to the Origins of Positive Theories: A Contribution to an Analysis of Paradigm Changes in Accounting Research Abstract: In this article, we analyse factors that explain the success of the empirical methodology of ‘positive accounting theory’ (PA) in accounting research. In fewer than ten years, between 1960 and 1967--1968, PA became dominant in the main accounting journals, and normative theories disappeared from academic publishing. The reasons for this success are not clearly established. The propagators of PA (Ball and Brown, 1968; Watts and Zimmerman, 1986) advocate the fertility of their approach, while others (e.g. Mattessich, 1995; Mouck, 1988; Whittington, 1987; Williams, 1989) denounce their ostracism and systematic denigration of rival approaches. Both proponents and opponents of PA consider the emergence of positive theories as a radical severance; however, we suggest that the move from normative to positive theories occurred gradually. Even if they took advantage of the reform that took place in US business schools during the 1950s, the proponents of PA also benefited from a decoupling between the academic world and accounting practice initiated by their predecessors. Journal: Accounting in Europe Pages: 107-126 Issue: 1 Volume: 6 Year: 2009 Month: 6 X-DOI: 10.1080/17449480902896510 File-URL: http://hdl.handle.net/10.1080/17449480902896510 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:1:p:107-126 Template-Type: ReDIF-Article 1.0 Author-Name: Christian Hoarau Author-X-Name-First: Christian Author-X-Name-Last: Hoarau Title: The Reform of the French Standard-Setting System: Its Peculiarities, Limits and Political Context Abstract: This paper analyses the 2007 reform of the Conseil National de la Comptabilité (and the creation of the Autorité des Normes Comptables -- ANC) from the perspective of the social and historical context since its birth, and studies the political context and its limits. It shows that the original concept of standard-setting in the French way has been profoundly modified. The notion of a representative decision-making body has been retained, but the collegial decision-making has been restricted and the number of interested participants reduced. Carried out under the pervasive influence of International Financial Reporting Standards (IFRS), the reform marks the power of the large companies and the ‘Big Four’ audit firms, whose employees play a large part in the process for developing standards. It also reflects a redefinition of the role of the state, although that stops short of complete disengagement. The state retains oversight of the standard-setting apparatus. The public authorities expect that the new organisation will have a greater capacity to react and to influence the global accounting debates that shape the evolution of IFRS. The paper asks the question whether France has sufficient human and financial resources to achieve such an objective, which presupposes a significant increase in accounting research. Journal: Accounting in Europe Pages: 127-148 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903171970 File-URL: http://hdl.handle.net/10.1080/17449480903171970 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:127-148 Template-Type: ReDIF-Article 1.0 Author-Name: Richard M. S. Wilson Author-X-Name-First: Richard M. S. Author-X-Name-Last: Wilson Author-Name: Aileen Pierce Author-X-Name-First: Aileen Author-X-Name-Last: Pierce Author-Name: Mark Allison Author-X-Name-First: Mark Author-X-Name-Last: Allison Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Author-Name: Bohumil Kral Author-X-Name-First: Bohumil Author-X-Name-Last: Kral Author-Name: Kim Watty Author-X-Name-First: Kim Author-X-Name-Last: Watty Title: Accountancy and Academic/Professional Inter-dependency (or Mutual Exclusivity?) Abstract: This paper is a report on an Accounting Education Symposium held during the 2009 Annual Congress of the EAA in Tampere, Finland. This was the fourth occasion on which there has been an Accounting Education Symposium (or similar) within an EAA Annual Congress. Previous events were as follows: 2005 (Gotenburg, Sweden) EAA Accounting Educators' Forum 2006 (Dublin, Ireland) ‘Universities and Professional Bodies: Complementary or Colliding Roles in Educating and Training Future Accounting Practitioners?’ (sponsored by the Irish Accountancy Educational Trust) 2008 (Rotterdam, the Netherlands) ‘Accounting Education: The Common Content Project’ (sponsored by Royal NIVRA). Journal: Accounting in Europe Pages: 149-166 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903171962 File-URL: http://hdl.handle.net/10.1080/17449480903171962 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:149-166 Template-Type: ReDIF-Article 1.0 Author-Name: Jannis Bischof Author-X-Name-First: Jannis Author-X-Name-Last: Bischof Title: The Effects of IFRS 7 Adoption on Bank Disclosure in Europe Abstract: With the endorsement of IFRS 7, which became effective in 2007, the European regulation of bank disclosures has substantially changed. Using a sample of 171 banks from 28 European countries, I analyze the effect of the standard's first-time adoption on disclosure quality. I find that disclosure quality has generally increased both in financial statements and in risk reports but that the focus of disclosures has shifted from market risk exposures to credit risk exposures. The effect of the first-time adoption strongly varies across countries. These variations can be explained by differences in the enforcement and interpretation of IFRS 7 by national banking supervision. Using supervisory practices in Denmark, Italy and the UK as representative examples, I distinguish between an interventionist and a non-interventionist approach. The findings suggest that it is not only the content of IFRS 7 but also the enforcement of the standard that accounts for the increase in disclosure quality. With respect to the enforcement of bank disclosures, the results therefore support recent proposals by the De Laroisière High Level Expert Group to harmonize financial supervision within the EU. Journal: Accounting in Europe Pages: 167-194 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903171988 File-URL: http://hdl.handle.net/10.1080/17449480903171988 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:167-194 Template-Type: ReDIF-Article 1.0 Author-Name: Brigitte Eierle Author-X-Name-First: Brigitte Author-X-Name-Last: Eierle Author-Name: Axel Haller Author-X-Name-First: Axel Author-X-Name-Last: Haller Title: Does Size Influence the Suitability of the IFRS for Small and Medium-Sized Entities? -- Empirical Evidence from Germany Abstract: This study is set within the context of the IASB's initiative to develop an IFRS for small and medium-sized entities (SMEs). It is based on a questionnaire survey of small and medium-sized entities in Germany exploring the suitability of the IASB's proposed SME standard for entities of different size classes. Quantitative size criteria are used in many national jurisdictions to differentiate financial reporting requirements between entities. However, there is very little empirical evidence on the question whether the economic size of an entity has an impact on the economic issues that should be regulated by accounting rules and on management's preferences for specific accounting methods. This paper addresses these deficiencies by exploring to what extend an entity's economic size has an impact on its international exposure, the relevance of specific accounting issues and preparers’ perceptions on costs and benefits associated with the application of selected accounting methods. Our findings are ambiguous. Size effects are revealed with regard to the structure of entities, their international exposure and to a large extent to the relevance of particular accounting issues. Cost and benefit assessments of accounting methods also differ within and between the size clusters investigated, albeit a generalisation of size as a factor determining the cost-benefit considerations of firms with regard to particular accounting treatments and methods is not supported by the study's results. Journal: Accounting in Europe Pages: 195-230 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903115779 File-URL: http://hdl.handle.net/10.1080/17449480903115779 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:195-230 Template-Type: ReDIF-Article 1.0 Author-Name: Alessandro Mechelli Author-X-Name-First: Alessandro Author-X-Name-Last: Mechelli Title: Accounting Harmonization and Compliance in Applying IASB Standards: An Empirical Survey about the First Time Adoption of IAS 7 by Italian Listed Groups Abstract: This paper deals with the First Time Adoption (FTA) of International Accounting Standards Board (IASB) standards by Italian entities, focusing on the cash flow statement (CFS) whose rules are stated by International Accounting Standards 7 (IAS 7). The purpose of this paper is to investigate both the degree of harmonization and compliance in applying IAS 7. To achieve this purpose, the research has been developed by analyzing a sample of 101 financial statements of Italian listed groups issued with reference to 2005. The results of this research show a high degree of heterogeneity in applying IASB standards and a high degree of noncompliance with IAS 7 by Italian groups. The high degree of heterogeneity could impair the comparability of financial statements across entities, requiring further efforts by IASB to reduce options permitted in its standards. The high degree of noncompliance creates the risk of misleading users who read audited financial statements thinking they are prepared according to IASB standards. Journal: Accounting in Europe Pages: 231-270 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903172077 File-URL: http://hdl.handle.net/10.1080/17449480903172077 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:231-270 Template-Type: ReDIF-Article 1.0 Author-Name: Martin Schmidt Author-X-Name-First: Martin Author-X-Name-Last: Schmidt Title: Fair Value: Your Value or Mine? An Observation on the Ambiguity of the Fair Value Notion Illustrated by the Credit Crunch Abstract: Current International Financial Reporting Standards (IFRSs) define fair value as a transaction price. In imperfect markets, buyer's and seller's marginal prices, at which they are rationally willing to transact, differ. The transaction price can be any amount within the range between those prices. However, scenarios are conceivable in which no such range exists because the seller's marginal price exceeds the buyer's. In this scenario, no arm's length transactions between knowledgeable, willing parties are possible. Such a scenario can be likely characterised by low liquidity and/or high information asymmetry and seems to be broadly consistent with what is recently referred to as the ‘credit crunch’. Under this scenario, the IFRS definition of fair value is not readily applicable. Two views are possible: under view 1, fair value refers to the potential buyer's marginal price. Although fair value does always exist conceptually, it negates the notion of two rationally acting parties. View 2 acknowledges that no arm's length transaction is possible, resulting in the fair value notion not being applicable. If these two views are applied to the IFRS definition of an active market, view 1 results in markets that are always active. Only view 2 allows distinguishing between active and inactive markets. Journal: Accounting in Europe Pages: 271-282 Issue: 2 Volume: 6 Year: 2009 Month: 12 X-DOI: 10.1080/17449480903115829 File-URL: http://hdl.handle.net/10.1080/17449480903115829 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:6:y:2009:i:2:p:271-282 Template-Type: ReDIF-Article 1.0 Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Editorial Journal: Accounting in Europe Pages: 1-1 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.498690 File-URL: http://hdl.handle.net/10.1080/17449480.2010.498690 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:1-1 Template-Type: ReDIF-Article 1.0 Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Title: Comment on the IASB Discussion Paper ‘Preliminary Views on Revenue Recognition in Contracts with Customers’ Journal: Accounting in Europe Pages: 3-13 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485386 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485386 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:3-13 Template-Type: ReDIF-Article 1.0 Author-Name: Axel Berger Author-X-Name-First: Axel Author-X-Name-Last: Berger Title: The Development and Status of Enforcement in the European Union Abstract: Enforcement's task is to protect capital markets by ensuring proper application of accounting standards. This paper examines how this goal is pursued on a European level and explores the different structures and processes of the national enforcement agencies. Considerations will be presented for improving the effectiveness of enforcement in Europe. Journal: Accounting in Europe Pages: 15-35 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485388 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485388 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:15-35 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Author-Name: Eva Eberhartinger Author-X-Name-First: Eva Author-X-Name-Last: Eberhartinger Title: The European Union Endorsement Process for International Financial Reporting Standards: A Telos-Based Analysis Abstract: The paper discusses the process for the endorsement of an IFRS in the European Union with regard to its compliance with teleological principles and with regard to the true and fair view. It begins with an exposition of the teleological principle under Roman law and its relationship to the true and fair view override, as known in the UK and in the EU. We then discuss firstly the telos-based criteria against which a new Standard is appraised during the endorsement process, and secondly the application of the true and fair view principle to the issue of which criteria an EU-endorsed IFRS should be appraised against as regards its application, using IFRS 3 as a specific illustration. The teleological principle is a crucial element in our conclusions. We show that this principle can be used, and in the EU is being used, to bypass democratic processes. The issues raised by this paper concern the operation of regulations designed to be, at least theoretically, context-neutral, within a specific legal and operational framework, that is, the European Union. But similar issues are likely to require consideration in other geographical areas, outside the European context. Journal: Accounting in Europe Pages: 37-62 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485373 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485373 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:37-62 Template-Type: ReDIF-Article 1.0 Author-Name: Joerg-Markus Hitz Author-X-Name-First: Joerg-Markus Author-X-Name-Last: Hitz Title: Press Release Disclosure of ‘Pro Forma’ Earnings Metrics by Large German Corporations -- Empirical Evidence and Regulatory Recommendations Abstract: This paper is set against the background of recent regulatory action and standard-setting activities pertaining to the disclosure of so-called ‘pro forma’ earnings. For a sample of large corporations listed on the Frankfurt stock exchange, I individually analyze quarterly earnings announcements published for the fiscal years 2005 and 2006. Given voiced concern about the potential of pro forma metrics to misrepresent firm performance and thus to potentially mislead investors, research questions pertain to the use, the calculation and the presentation of pro forma earnings, and the impact of recent recommendations issued by European securities commissions. The results indicate that firms make extensive use of so-called ‘EB’ (earnings before) metrics and, more importantly, of pure non-GAAP performance measures, both in terms of frequency and reporting emphasis. The transparency of adjustments to GAAP earnings turns out to be low. Year-to-year analysis suggests that recent recommendations by European securities regulators have had no discernible impact on these disclosure patterns. Taken together, this evidence suggests that regulatory concern may be warranted. At the same time, it points out the need for more research into the determinants and the investor reception of pro forma earnings disclosures in EU jurisdictions. Journal: Accounting in Europe Pages: 63-86 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485376 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485376 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:63-86 Template-Type: ReDIF-Article 1.0 Author-Name: Erlend Kvaal Author-X-Name-First: Erlend Author-X-Name-Last: Kvaal Title: The Discount Rate of IAS 36 -- A Comment Abstract: Discussing the guidance in IAS 36 on how to determine the discount rate for present value measurements of impairment reviews, Husmann and Schmidt (Accounting in Europe, 5, pp. 49--62, 2008) conclude that the standard's option to use ‘the entity's incremental borrowing rate’ should be removed. I argue that their conclusion is based on a misconception about what is meant by incremental borrowing, and that the incremental borrowing rate may be a useful approximation to the cost of capital within a Capital Asset Pricing Model (CAPM) framework. The reference to it is even more useful if CAPM is deemed not to hold. An important objection to the IAS 36 rules on the discount rate is that they are so different from the US GAAP rules: the former are detailed and adhere closely to the CAPM ideal, whereas the latter are general in nature, superficial and lack theoretical underpinnings. Any modification of the accounting standards' rules on the discount rate should first seek to remove that gap. Journal: Accounting in Europe Pages: 87-95 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485378 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485378 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:87-95 Template-Type: ReDIF-Article 1.0 Author-Name: Maria Gee Author-X-Name-First: Maria Author-X-Name-Last: Gee Author-Name: Axel Haller Author-X-Name-First: Axel Author-X-Name-Last: Haller Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: The Influence of Tax on IFRS Consolidated Statements: The Convergence of Germany and the UK Abstract: The literature on the links between tax and financial reporting suggests that the strength of those links varies over time and from one jurisdiction to another. The links in Germany were seen to be particularly strong, and those in the UK rather weak. Previous literature was largely set in the context of unconsolidated statements but authors have suggested that their findings were relevant for consolidated reporting. This paper examines the scope for tax influence on IFRS consolidated financial reporting in the two above countries. We find that the overall position for Germany and the UK is now similar, that is, that the potential for tax influence is much weaker in Germany than recorded in previous studies. We also find that, even for unconsolidated reporting under domestic accounting rules, the extreme positions recorded for the two countries in the 1990s have been modified. Journal: Accounting in Europe Pages: 97-122 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485382 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485382 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:97-122 Template-Type: ReDIF-Article 1.0 Author-Name: Stephen A. Zeff Author-X-Name-First: Stephen A. Author-X-Name-Last: Zeff Title: A Comment on ‘Delegation’ Journal: Accounting in Europe Pages: 123-125 Issue: 1 Volume: 7 Year: 2010 Month: 6 X-DOI: 10.1080/17449480.2010.485389 File-URL: http://hdl.handle.net/10.1080/17449480.2010.485389 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:1:p:123-125 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Editorial Journal: Accounting in Europe Pages: 127-128 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.534289 File-URL: http://hdl.handle.net/10.1080/17449480.2010.534289 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:127-128 Template-Type: ReDIF-Article 1.0 Author-Name: Brian Singleton-Green Author-X-Name-First: Brian Author-X-Name-Last: Singleton-Green Title: The Communication Gap: Why Doesn't Accounting Research Make a Greater Contribution to Debates on Accounting Policy? Abstract: On many important accounting problems there seems to be a gap in knowledge and understanding between the academic world and those whose views are most prominent in public debate. The paper explores the reasons for this gap, and suggests that the biggest problem is the perception of irrelevance. The paper discusses how the gap can be narrowed, using ICAEW's Information for Better Markets work, in particular on business reporting models, as an example. Journal: Accounting in Europe Pages: 129-145 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.511880 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511880 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:129-145 Template-Type: ReDIF-Article 1.0 Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Title: On the Definitions of Income, Expenses and Profit in IFRS Abstract: This paper makes two contributions. First, it demonstrates that income and expenses are incorrectly defined in the IASB's conceptual framework, and it proposes alternative definitions. Second, the paper identifies that, in part as a consequence of these incorrect definitions, and in part because there are two, conflicting concepts of profit in IFRS, there is, first, no definition of profit in the Framework and, second, inconsistency and needless complexity in the concept of profit in IAS 1. The issues raised in this paper contribute to the current IASB projects on the conceptual framework and on financial statement presentation. Journal: Accounting in Europe Pages: 147-158 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.511892 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511892 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:147-158 Template-Type: ReDIF-Article 1.0 Author-Name: Susana Callao Author-X-Name-First: Susana Author-X-Name-Last: Callao Author-Name: José Ignacio Jarne Author-X-Name-First: José Ignacio Author-X-Name-Last: Jarne Title: Have IFRS Affected Earnings Management in the European Union? Abstract: There has recently been considerable discussion of those features of IFRS that are likely to help improve financial reporting in the European Union. However, certain issues may also have a negative impact on the quality of information. This paper focuses on the effect of IFRS on earnings management. Its main purpose is to examine whether the adoption of IFRS in the European Union has increased or decreased the scope for discretionary accounting practices by comparing discretionary accruals in the periods preceding and immediately after the regulatory change. Another objective is to determine which firms' features and country factors may explain the accounting discretion observed before and after IFRS. We consider a sample of non-financial firms listed on 11 EU stock markets. The results obtained show that earnings management has intensified since the adoption of IFRS in Europe, as discretionary accruals have increased in the period following implementation. The variables explaining accounting discretion are the same before and after IFRS (business size, leverage, investor protection and legal enforcement). These results suggest that variations in earnings management might be due to some room for manipulation under international standards when compared with local standards. Journal: Accounting in Europe Pages: 159-189 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.511896 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511896 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:159-189 Template-Type: ReDIF-Article 1.0 Author-Name: Carien van Mourik Author-X-Name-First: Carien Author-X-Name-Last: van Mourik Title: The Equity Theories and Financial Reporting: An Analysis Abstract: This paper reviews accounting literature in the English language on proprietary and entity theory in order to understand their implications for financial accounting and reporting. Although there is a lack of agreement on the definition and accounting implications of the various equity theories, the literature indicates clear differences between pure proprietary and pure entity perspectives of the firm. These differences particularly relate to the purpose of accounting and financial reporting, the distinction between debt and equity and its accounting implications for the analysis and recording of transactions and recordable events, and the definition, determination, disclosure and distribution of income. The main contribution of this paper is twofold. First, it explains in operational terms why an entity perspective of the company is theoretically irreconcilable with the asset--liability approach to the determination of income. Second, it makes clear that there is always an implicit perspective to financial reporting. Inconsistency in accounting standards results if the implicit perspective is not the same as the perceived focus of decision-usefulness. Journal: Accounting in Europe Pages: 191-211 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.511885 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511885 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:191-211 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: On Researching into the Use of IFRS by Private Entities in Europe Abstract: There were three important regulatory developments in 2009 for accounting by private entities in Europe, including a new IASB standard designed mainly for private entities. This research note considers the EU regulatory context and other issues relevant to research into voluntary adoption of international standards by private entities in Europe. These are applied as a critical case study of a previously published paper. Journal: Accounting in Europe Pages: 213-226 Issue: 2 Volume: 7 Year: 2010 Month: 12 X-DOI: 10.1080/17449480.2010.511889 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511889 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:7:y:2010:i:2:p:213-226 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Author-Name: Monique Micallef Author-X-Name-First: Monique Author-X-Name-Last: Micallef Title: Accounting Regulation in Malta Abstract: This paper considers the development of accounting rules in Malta, and traces the changing de jure requirement of a ‘true and fair view’ (TFV) in national legislation. This is done in three phases. The initial phase discusses financial reporting issues arising from the then ambiguous TFV wording in the Companies Act 1995. The changing TFV wording is compared to the UK Companies Act 1948 and to the European Community Directives being the basis of national company legislation. Due to the ever-increasing conflicts between IFRS and national legislation, ways how the local accounting profession has applied the TFV principle are then illustrated. The impact on the audit reports, arising from implementation of the IAS Regulation (1606/2002/EC) is discussed in the second phase. It is found that the IAS Regulation brought about a lack of clarity as to the applicable regulatory financial reporting framework for listed entities. In the third phase, the practical difficulties and issues that led to the recent development of a national financial reporting standard for smaller entities are examined in an international context. The possible implications of a second de jure imposition of a TFV, in this national standard, are put forward. Journal: Accounting in Europe Pages: 1-21 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2010.511877 File-URL: http://hdl.handle.net/10.1080/17449480.2010.511877 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:1-21 Template-Type: ReDIF-Article 1.0 Author-Name: Alain Burlaud Author-X-Name-First: Alain Author-X-Name-Last: Burlaud Author-Name: Bernard Colasse Author-X-Name-First: Bernard Author-X-Name-Last: Colasse Title: International Accounting Standardisation: Is Politics Back? Abstract: In the absence of political legitimacy, international accounting standardisation is founded on procedural and substantial legitimacies, which have been challenged by the current financial crisis. This paper represents a critique of this built up legitimacy. It demonstrates in particular that whilst due process is admittedly a transparent procedure, it is one in which only those players with major financial and intellectual resources can participate. It also highlights the weakness of the theoretical foundation, in particular agency theory and the theory of efficient markets, on which the conceptual framework of the IASB rests. This critical study of the foundations of the legitimacy of the IASC/IASB enables us to understand the extent of recent political intervention in a field that had previously been abandoned. Whilst international accounting standards did not trigger the crisis, some observers have said that they accelerated and even amplified it, mainly as a result of their pro-cyclical nature. This explains why, in October 2008, the international standard-setter was suddenly called to order by the European Union who requested it to urgently amend its Standards IAS 39 ‘Financial Instruments’ and IFRS 7 ‘Financial Instruments: Disclosures’. This intervention by a political organisation is all the more remarkable since international accounting standardisation seemed to have been definitively handed over to specialists from the IASC/IASB, a body which had declared itself to be the international standardiser. The crisis therefore strongly undermined the legitimacy of the international standardiser. This raises the question of whether we are about to witness the return of politics in a field, which is, in reality, highly political. This possible return is indicated not only by the pressures successfully exerted on the international standardisation body by the EU and the G8 but also the recommendations made to the IASC/IASB by the new G20 and the publication in France of reports of a political, highly critical nature, devoted to the recent evolution of accounting standardisation. In this paper, using a reflexive, critical approach, we question the legitimacy of the IASC/IASB with the aim of evaluating the extent of the political recommendations made to it. It is clear that the legitimacy of an accounting standardisation body is fundamental since it conditions the legitimacy of the standards it issues, accounting practice itself and in the end, the confidence of users in the financial statements of companies. But this legitimacy is not innate. It is not natural or pre-existing. As we shall see, it is constructed and managed. In the first section, we will examine, and try to specify, the foundations of the IASB. In the second section, we will demonstrate the fragility of these foundations, a fragility that existed before the crisis but which the latter exposed more clearly. Lastly, in the third section, we will attempt to see if recent interventions of political organisations in the international accounting standardisation process have challenged the international standardiser and if they herald the return of politics. Journal: Accounting in Europe Pages: 23-47 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2011.574412 File-URL: http://hdl.handle.net/10.1080/17449480.2011.574412 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:23-47 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Fiechter Author-X-Name-First: Peter Author-X-Name-Last: Fiechter Title: Reclassification of Financial Assets under IAS 39: Impact on European Banks' Financial Statements Abstract: In response to the financial crisis, the IASB issued on 13 October 2008 an amendment to IAS 39 which enables entities to reclassify non-derivative financial assets held for trading and financial assets available-for-sale. This paper examines the influence of this controversial amendment on the 2008 financial statements of 219 European banks which apply IFRS. I find that approximately one-third of the sample banks have taken extensive advantage of these reclassification opportunities. The mean reclassification amount is 3.9% of total assets and 131% of the book value of equity, respectively. I further document that reclassifying banks avoid substantial fair value losses, and hence, report significantly higher levels of return on assets (ROA), return on equity (ROE), book value of equity and regulatory capital. In particular, the mean ROE switches sign from a negative ROE of −1.4% to a positive ROE of 1.3% due to gains from reclassifications. Overall, this paper documents a substantial impact of the amendments on banks' financial statements and suggests analysing these reclassifications with particular caution. Journal: Accounting in Europe Pages: 49-67 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2011.574409 File-URL: http://hdl.handle.net/10.1080/17449480.2011.574409 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:49-67 Template-Type: ReDIF-Article 1.0 Author-Name: Anja Hjelström Author-X-Name-First: Anja Author-X-Name-Last: Hjelström Author-Name: Walter Schuster Author-X-Name-First: Walter Author-X-Name-Last: Schuster Title: Standards, Management Incentives and Accounting Practice -- Lessons from the IFRS Transition in Sweden Abstract: The process of preparing financial statements gives rise to numerous accounting choices. Understanding these choices is critical for an understanding of accounting practice. The 2005 transition to IFRS in Europe provides a unique opportunity for studying the forces and factors that shape accounting practices. Based on empirical data from a series of in-depth interviews focusing on the choices and problems listed companies faced in the transition to IFRS in Sweden, we suggest that it may be appropriate to enrich the accounting policy choice literature by recognizing a wider spectrum of management incentives and available alternatives when making accounting policy choice decisions. In particular, we suggest that it may be fruitful to explore the role of incentives arising from the management control function. Our findings underline the importance of addressing how management incentives shape accounting practices and hence influence the outcome of the IFRS transition. They also suggest that a better understanding of the relationship between standards, incentives and actual accounting practices requires distinctions of different degrees and aspects of compliance. Journal: Accounting in Europe Pages: 69-88 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2011.574400 File-URL: http://hdl.handle.net/10.1080/17449480.2011.574400 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:69-88 Template-Type: ReDIF-Article 1.0 Author-Name: Rebekka Kager Author-X-Name-First: Rebekka Author-X-Name-Last: Kager Author-Name: Deborah Schanz Author-X-Name-First: Deborah Author-X-Name-Last: Schanz Author-Name: Rainer Niemann Author-X-Name-First: Rainer Author-X-Name-Last: Niemann Title: Estimation of Tax Values Based on IFRS Information: An Analysis of German DAX30 and Austrian ATX Listed Companies Abstract: Although tax values of corporate assets and liabilities could provide useful information for various economic decisions, they are typically unknown to financial statement users. Additional corporate tax information has been repeatedly claimed. We analyse whether tax balance sheets can be reconstructed using tax information provided by consolidated IFRS accounts. Our results suggest that, for DAX30 firms, the most important differences between IFRS and tax reporting occur for intangibles and provisions. For ATX companies, diverging IFRS and tax rules relating to fixed assets and provisions are the main cause for IFRS--tax differences. We find evidence that book values reported in IFRS balance sheets are generally higher than tax values. Only in connection with inventories, we observe that the median of estimated tax values is higher than IFRS-book value for both Austrian and German groups. We also try to estimate the total stock of unused tax losses because it offers information about a company's potential loss offsets and future tax payments. Our analyses show that estimated values of tax losses often do not differ substantially from the actual stock of tax losses. Due to several methodological and practical problems, we conclude that, especially for multinationals, reconstructed tax balance sheets should be critically scrutinised. Journal: Accounting in Europe Pages: 89-123 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2011.574362 File-URL: http://hdl.handle.net/10.1080/17449480.2011.574362 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:89-123 Template-Type: ReDIF-Article 1.0 Author-Name: Sven Husmann Author-X-Name-First: Sven Author-X-Name-Last: Husmann Author-Name: Martin Schmidt Author-X-Name-First: Martin Author-X-Name-Last: Schmidt Title: ‘The Discount Rate of IAS 36’ -- A Reply to Kvaal (AiE, Vol. 7, pp. 87--95, 2010) Journal: Accounting in Europe Pages: 125-126 Issue: 1 Volume: 8 Year: 2011 Month: 6 X-DOI: 10.1080/17449480.2011.574407 File-URL: http://hdl.handle.net/10.1080/17449480.2011.574407 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:1:p:125-126 Template-Type: ReDIF-Article 1.0 Author-Name: Philippe Danjou Author-X-Name-First: Philippe Author-X-Name-Last: Danjou Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: The Legitimacy of the IASB Abstract: This paper takes issue with Burlaud and Colasse (Accounting in Europe, 8, pp. 23--47, 2011a) who suggest that the International Accounting Standards Board (IASB) lacks legitimacy and that this has led to a return of politics to standard-setting. We show that the IASB is supported by the leaders of the world's major economies (G20), and by the European Commission and European Parliament. The European Commission's policy is to pursue wider adoption of the IASB's standards. We go on to suggest that politics has never been absent from standard-setting and to note that a number of the positions taken by Burlaud and Colasse are not supported by the mainstream literature. Journal: Accounting in Europe Pages: 1-15 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664396 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664396 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:1-15 Template-Type: ReDIF-Article 1.0 Author-Name: Reiner Quick Author-X-Name-First: Reiner Author-X-Name-Last: Quick Title: EC Green Paper Proposals and Audit Quality Abstract: In order to restore confidence in financial statements the European Commission proposes different measures to enhance audit quality. This paper examines potential effects of selected proposals on audit quality in the light of prior research findings. It concludes that an increased emphasis on substantive audit procedures may not be beneficial and that joint audits potentially improve competition and audit quality, but might increase audit fees. An appointment by a third party would strengthen auditor independence. The overall impact of a mandatory rotation of audit firms is unclear due to opposite effects on auditor competence and auditor independence. The provision of non-audit services might affect independence in appearance negatively. However, a total ban would not be necessary. Finally, a limit to the proportion of fees an audit firm can receive from a single client as well as a capping of non-audit fees seem to be desirable. Journal: Accounting in Europe Pages: 17-38 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664398 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664398 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:17-38 Template-Type: ReDIF-Article 1.0 Author-Name: Jörgen Dahlgren Author-X-Name-First: Jörgen Author-X-Name-Last: Dahlgren Author-Name: Sven-Arne Nilsson Author-X-Name-First: Sven-Arne Author-X-Name-Last: Nilsson Title: Can Translations Achieve Comparability? The Case of Translating IFRSs into Swedish Abstract: Since 2005, all listed EU/EFTA companies are obliged to prepare their consolidated statements fully in accordance with the International Financial Reporting Standards (IFRSs). The requirement is a consequence of an EU decision, in Lisbon in March 2000, aiming at improving the flow of capital within a free internal market. Since the IFRSs are in the English language, this has made it necessary to translate them into all the languages in the European Union. The purpose of the translation is to produce the same quality regulation in each member state and consequently achieve comparability. The purpose of this paper is to evaluate the comparability objective from an accounting language perspective. We do this by using the translation of IFRSs into Swedish. Since the IFRSs are translated from English to every other language within the EU, the Swedish experience is potentially relevant to all the other member states. The discussion is based on translation theory and the result indicates that comparability is not achieved simply by using words from another language. To achieve true and genuine comparability, contexts need to match or be made congruent. Journal: Accounting in Europe Pages: 39-59 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664391 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664391 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:39-59 Template-Type: ReDIF-Article 1.0 Author-Name: Angels Fitó Author-X-Name-First: Angels Author-X-Name-Last: Fitó Author-Name: Francesc Gómez Author-X-Name-First: Francesc Author-X-Name-Last: Gómez Author-Name: Soledad Moya Author-X-Name-First: Soledad Author-X-Name-Last: Moya Title: Choices in IFRS Adoption in Spain: Determinants and Consequences Abstract: New Spanish GAAP based on IFRS came into force for separate financial statements in 2008. Companies were allowed to choose between 1 January 2007 and 1 January 2008 as their transition date. The first option commits companies to presenting comparative statements while the second allows them to disclose only the adjustments in equity. We analyze the determinants of companies that decided to choose early transition and also the consequences of this choice on the main accounting figures and ratios. Our results show that the determinants of the early transition date are size and growth. As for the consequences, there is a significant change in the accounting figures and ratios and therefore comparability may be impaired. Journal: Accounting in Europe Pages: 61-83 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664390 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664390 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:61-83 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: On the Definitions of Income and Revenue in IFRS Abstract: In a previous issue of this journal, Richard Barker addressed some problems with the IFRS definitions of income and profit. I apply his conclusions to the definition of ‘revenue’ that he did not cover. I point out other difficulties with the definition: the implication that some sales to customers are not revenue, the implication that receipts to settle accounts receivable (or to sell receivables to a bank) are revenue, and the out-dated term ‘ordinary activities’. Most of the problems with the definition of revenue remain in the IASB's exposure drafts of 2010 and 2011. I also suggest that, despite IASB statements, fair value gains on assets should not be considered to be revenue, and nor should the financial receipts of non-financial companies. This leads to the suggestion that a replacement for IAS 18 should deal with the wider topic of ‘income’, and then define ‘revenue’ more narrowly than at present as the gross increase in equity resulting from inflows from customers for certain types of performance under contracts. Journal: Accounting in Europe Pages: 85-94 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664395 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664395 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:85-94 Template-Type: ReDIF-Article 1.0 Author-Name: Selcuk Yalcin Author-X-Name-First: Selcuk Author-X-Name-Last: Yalcin Title: Adoption and Benefits of Management Accounting Practices: An Inter-country Comparison Abstract: Management accounting practices of firms are determined by the scope and amount of information expected from them. Therefore, management accounting practices might differ among firms or countries. This study aims to determine the management accounting practices used by manufacturing firms in Turkey and why these practices are used, through employing a questionnaire. In addition, the adoption rates of these practices are compared with six previous studies on the matter. This study suggests possible reasons for the use of these practices and intentions to use them in the future in Turkey. The findings indicate that the rates of adoption of traditional management accounting practices are higher than those of recently developed techniques. The adoption rates obtained in Turkey are seen to be higher than those obtained from the previous six studies. Journal: Accounting in Europe Pages: 95-110 Issue: 1 Volume: 9 Year: 2012 Month: 6 X-DOI: 10.1080/17449480.2012.664394 File-URL: http://hdl.handle.net/10.1080/17449480.2012.664394 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:1:p:95-110 Template-Type: ReDIF-Article 1.0 Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Title: Editorial Journal: Accounting in Europe Pages: 111-112 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.725513 File-URL: http://hdl.handle.net/10.1080/17449480.2012.725513 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:111-112 Template-Type: ReDIF-Article 1.0 Author-Name: Axel Haller Author-X-Name-First: Axel Author-X-Name-Last: Haller Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Author-Name: David Cairns Author-X-Name-First: David Author-X-Name-Last: Cairns Author-Name: Anja Hjelström Author-X-Name-First: Anja Author-X-Name-Last: Hjelström Author-Name: Soledad Moya Author-X-Name-First: Soledad Author-X-Name-Last: Moya Author-Name: Michael Page Author-X-Name-First: Michael Author-X-Name-Last: Page Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: The Effects of Accounting Standards -- A Comment Abstract: This paper brings together the comments made by the European Accounting Association's Financial Reporting Standards Committee to a discussion paper (DP) issued by European Financial Reporting Advisory Group/UK Accounting Standards Board (ASB). It analyses the content of the DP and then discusses what effects should be considered. It considers that all effects should be evaluated, irrespective of whether they normally fall within the standard-setter's purlieu, and provides a taxonomy of effects. It illustrates the difficulty of determining what effects should be considered by the standard-setter. The paper then discusses when effects should be reviewed. It agrees with the DP that effects need to be considered from inception of the project. It disagrees that the standard-setter should necessarily be responsible for all of the effects analysis. It argues that effects are likely to be different by geographical region and industry sector, and recourse should be had to national standard-setters and other organisations. While preparers may make representations about effects during the due process, these are not likely to be a representative sample. The paper suggests that in particular post-implementation reviews are better carried out independently. It observes that the DP does not address the practicalities of carrying out research in this area. Journal: Accounting in Europe Pages: 113-125 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720870 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720870 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:113-125 Template-Type: ReDIF-Article 1.0 Author-Name: Marco Trombetta Author-X-Name-First: Marco Author-X-Name-Last: Trombetta Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Author-Name: Peter Wysocki Author-X-Name-First: Peter Author-X-Name-Last: Wysocki Title: The Usefulness of Academic Research in Understanding the Effects of Accounting Standards Abstract: This paper provides an overview of why, and how, academic research can assist regulators and standard setters in evaluating ex ante and ex post the effects of standardization and regulation of corporate financial reporting and disclosure. We argue that academic research is a valuable and often underutilized resource that can help standard setters and policymakers understand the possible effects of accounting standards and regulations. We give an overview of approaches that can, and are, used for this objective and provide selected examples to illustrate how academic research can inform standard setters and regulators. Journal: Accounting in Europe Pages: 127-146 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720871 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720871 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:127-146 Template-Type: ReDIF-Article 1.0 Author-Name: Mario Abela Author-X-Name-First: Mario Author-X-Name-Last: Abela Author-Name: Araceli Mora Author-X-Name-First: Araceli Author-X-Name-Last: Mora Title: Understanding the Consequences of Accounting Standards in Europe: The Role of EFRAG Abstract: The global financial crisis has accelerated the need for standard-setters to demonstrate that they understand the effects of the accounting standards they are setting. Within a European context, the endorsement process and the ultimate adoption of new and amended International Financial Reporting Standards into European Union law demand that there is evidence to support the assertion that such standards will improve financial reporting. Our analysis is anchored in the ideology theory of regulation which provides a compelling case for effect analysis to underpin the standard-setting process. For that process to work effectively, a number of key actors need to engage in the process. Accordingly, the aim of this paper is to analyse the potential role of those actors in the standard-setter's analysis of effects. It is argued that there is a significant role for academic research to play in that process and that intermediaries, such as European Financial Reporting Advisory Group, can serve to bring research to the attention of the standard-setter. However, addressing the current disconnect between standard-setters and accounting researchers is not straightforward and we propose various strategies for how that relationship could be improved. We argue that these changes may lead to an improvement in the efficiency and effectiveness of the standard-setting process. Journal: Accounting in Europe Pages: 147-170 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720872 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720872 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:147-170 Template-Type: ReDIF-Article 1.0 Author-Name: Christian Gross Author-X-Name-First: Christian Author-X-Name-Last: Gross Author-Name: Roland Königsgruber Author-X-Name-First: Roland Author-X-Name-Last: Königsgruber Title: What You Measure is What You Get: The Effects of Accounting Standards Effects Studies Abstract: The UK's Accounting Standards Board and the European Financial Reporting Advisory Group have published a discussion paper entitled ‘Considering the Effects of Accounting Standards’. While the effort to think through potential consequences of proposed regulatory acts in advance is welcome, we argue that these effects are not only dependent on the investigated standards themselves, but also on the institutional environment where they unfold, which is heterogeneous in different jurisdictions. More importantly, insights from behavioural research on decision heuristics suggest that the public debate surrounding accounting reforms will evolve around the topics emphasised in effects studies, while other potential areas of interest are likely to be ignored. As costs of proposed standards are even harder to measure than costs of existing ones, a problem of regulatory overproduction could be exacerbated. We suggest a more modest approach of focusing on identifying ‘failure conditions’ under which new standards are likely to lead to detrimental consequences. Journal: Accounting in Europe Pages: 171-190 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720873 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720873 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:171-190 Template-Type: ReDIF-Article 1.0 Author-Name: Benedikt Link Author-X-Name-First: Benedikt Author-X-Name-Last: Link Title: The Struggle for a Common Interim Reporting Frequency Regime in Europe Abstract: This paper analyzes the effect of the Transparency Directive (TD) on interim reporting frequency in the European Union (EU). The TD defines the minimum content of annual and interim reports. In contrast to the USA, quarterly financial reporting is currently not mandatory in the EU. However, Member States and stock market operators can enact stricter local regulations. In October 2011, the Commission published a draft to modernize the TD proposing to abolish mandatory quarterly reporting across the EU. This surprising amendment is in contrast to the Commission's original intention. This article analyzes the reporting frequency regulation in the EU and the potential effect of abolishing mandatory quarterly reporting on the reporting frequency. I find that voluntary quarterly reporting is a function of firm, industry and country characteristics and, although managers are reluctant to change reporting frequency, abolishing mandatory quarterly reporting might lead to a reduction of quarterly reporting in several countries in the long run. This could have significant effects on, for instance, the information asymmetry in these countries that regulators should consider. On a more general note, given the variety of opinions on the ‘right’ interim reporting requirements in the EU, results from academic research could probably further facilitate a more fact-based debate on the issue and further research should investigate the capital market and real business effects of reporting frequency regulation in the specific EU context. Journal: Accounting in Europe Pages: 191-226 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720874 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720874 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:191-226 Template-Type: ReDIF-Article 1.0 Author-Name: Robin Litjens Author-X-Name-First: Robin Author-X-Name-Last: Litjens Author-Name: Sanjay Bissessur Author-X-Name-First: Sanjay Author-X-Name-Last: Bissessur Author-Name: Henk Langendijk Author-X-Name-First: Henk Author-X-Name-Last: Langendijk Author-Name: Ruud Vergoossen Author-X-Name-First: Ruud Author-X-Name-Last: Vergoossen Title: How Do Preparers Perceive Costs and Benefits of IFRS for SMEs? Empirical Evidence from the Netherlands Abstract: This paper examines how preparers perceive the association between costs and benefits of International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs). Extant research on costs and benefits associated with IFRS for SMEs is inconclusive. Our results suggest that preparers consider costs and benefits of IFRS for SMEs separately, not concurrently, and evaluate them in relative terms. Taken together, the results indicate that a voluntary adoption decision depends on the preparers' context for the cost--benefit analysis, which appears to be a nonlinear process. Specifically, our findings could contribute to the discussion by the European Financial Reporting Advisory Group on taking the effects of accounting standards into account whilst developing standards. Journal: Accounting in Europe Pages: 227-250 Issue: 2 Volume: 9 Year: 2012 Month: 12 X-DOI: 10.1080/17449480.2012.720875 File-URL: http://hdl.handle.net/10.1080/17449480.2012.720875 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:9:y:2012:i:2:p:227-250 Template-Type: ReDIF-Article 1.0 Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Author-Name: Elisabetta Barone Author-X-Name-First: Elisabetta Author-X-Name-Last: Barone Author-Name: Jacqueline Birt Author-X-Name-First: Jacqueline Author-X-Name-Last: Birt Author-Name: Ann Gaeremynck Author-X-Name-First: Ann Author-X-Name-Last: Gaeremynck Author-Name: Anne Mcgeachin Author-X-Name-First: Anne Author-X-Name-Last: Mcgeachin Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Rucsandra Moldovan Author-X-Name-First: Rucsandra Author-X-Name-Last: Moldovan Title: Response of the EAA FRSC to the EFRAG/ANC/FRC Discussion Paper: Towards a Disclosure Framework for the Notes Abstract: We summarise the response of the EAA's FRSC to Towards a Disclosure Framework for the Notes, a Discussion Paper (DP) issued jointly by EFRAG, ANC and FRC. While supportive of much of the DP, and in particular of the underlying aim to place disclosures on a sounder conceptual foundation, we identify two broad themes for further development. The first concerns the DP's diagnosis of the problem, which is that the existing financial reporting is characterised by, on the one hand, disclosure overload and, on the other hand, an absence of a conceptual framework for organising and communicating disclosures. Our review of the literature suggests much greater support for the second of these two factors than for the first. The second broad theme is the purpose of the proposed DF, and the principles that are derived from this purpose. Here, we stress the need for the framework to better accommodate the context within which financial statement disclosures are used. In practice, this context is characterised by variation in information, incentives and enforcement, each of which has a considerable effect on the appropriate disclosure policy and practice in any given situation. Journal: Accounting in Europe Pages: 1-26 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772715 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772715 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:1-26 Template-Type: ReDIF-Article 1.0 Author-Name: Corinna Ewelt-Knauer Author-X-Name-First: Corinna Author-X-Name-Last: Ewelt-Knauer Author-Name: Anna Gold Author-X-Name-First: Anna Author-X-Name-Last: Gold Author-Name: Christiane Pott Author-X-Name-First: Christiane Author-X-Name-Last: Pott Title: Mandatory Audit Firm Rotation: A Review of Stakeholder Perspectives and Prior Research Abstract: The global financial crisis brought to the fore questions surrounding the scope and quality of the external audit, market concentration and auditor independence. One of the issues currently being considered by the European Commission and European Parliament is mandatory audit firm rotation. The aim of this review is to identify, consider and evaluate stakeholder views and research evidence on mandatory audit firm rotation to highlight deficiencies in the existing research literature, identify opportunities for further research and make recommendations for policy-makers. As demonstrated, stakeholder views vary widely. We find that the research evidence on the impact of mandatory audit firm rotation on audit quality and auditor independence is inconclusive. Whilst there is some evidence that rotation may have a positive impact on ‘independence in appearance’, most research fails to generalise these findings to measures of audit quality associated with ‘independence in fact’ and there is even evidence of potentially adverse effects of rotation. Given the lack of evidence associating mandatory audit firm rotation with an improvement on audit quality, regulators need to determine carefully the long-term objectives of a mandatory rotation requirement before implementing a costly measure. We further highlight the need for future research looking at the implications of measures designed to improve audit quality. Journal: Accounting in Europe Pages: 27-41 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772717 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772717 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:27-41 Template-Type: ReDIF-Article 1.0 Author-Name: Giovanna Gavana Author-X-Name-First: Giovanna Author-X-Name-Last: Gavana Author-Name: Gabriele Guggiola Author-X-Name-First: Gabriele Author-X-Name-Last: Guggiola Author-Name: Anna Marenzi Author-X-Name-First: Anna Author-X-Name-Last: Marenzi Title: Evolving Connections Between Tax and Financial Reporting in Italy Abstract: We analyze the evolution of the relationship between tax and financial reporting in Italy after the mandatory introduction of International Financial Reporting Standards (IFRS) in 2005. Italy represents an interesting case study among European countries, with domestic generally accepted accounting principles (GAAP) oriented towards creditor protection and characterized by a close connection of financial and tax accounting. Unusually, the adoption of IFRS is compulsory for the unconsolidated financial statements of listed companies, but the process of alignment of domestic GAAP to IFRS, that has affected some countries, has had little effect on Italy. Thus, two accounting systems, IFRS and Italian GAAP, are used for the preparation of unconsolidated financial statements by different categories of companies and, as a consequence, two different linkages between tax and financial reporting emerge. In order to assess the degree and the direction of the book-tax linkages we use the methodology developed by Lamb, Nobes and Roberts (1998. International variations in the connections between tax and financial reporting, Accounting and Business Research, 28(3), pp. 173--188). IFRS and tax reporting show a high degree of disconnection, while Italian GAAP, in line with the accounting tradition of most continental European countries, are closely related to tax rules. The analysis points out a rapidly evolving situation, with links between accounting systems and taxation becoming tighter, mainly because of the changes in tax law introduced during the last few years. Journal: Accounting in Europe Pages: 43-70 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.774733 File-URL: http://hdl.handle.net/10.1080/17449480.2013.774733 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:43-70 Template-Type: ReDIF-Article 1.0 Author-Name: Madlen Haupt Author-X-Name-First: Madlen Author-X-Name-Last: Haupt Author-Name: Roland Ismer Author-X-Name-First: Roland Author-X-Name-Last: Ismer Title: The EU Emissions Trading System under IFRS -- Towards a ‘True and Fair View’ Abstract: This research paper seeks to contribute to the latest discussions on the financial reporting for emissions trading schemes. It analyses the International Financial Reporting Standards' (IFRS) accounting policies for emissions allowances, liabilities and carbon hedging instruments which are currently applied by the majority of participants in the European Union Emissions Trading System (EU ETS). The paper introduces assessment criteria for the evaluation of different accounting approaches and argues that the current rules under IFRS are not fully appropriate. A future accounting standard on emission trading schemes should largely follow the recent tentative decisions reached by the International Accounting Standards Board and Financial Accounting Standards Board. However, a different solution is advocated for the subsequent measurement of emission allowances held for compliance and the credit-side entry for freely allocated allowances. Only such an adjusted approach would capture the particular nature and purpose of cap and trade emissions trading schemes like the EU ETS and hence result in financial information which is useful to management and investors alike. Journal: Accounting in Europe Pages: 71-97 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772726 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772726 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:71-97 Template-Type: ReDIF-Article 1.0 Author-Name: Robert K. Larson Author-X-Name-First: Robert K. Author-X-Name-Last: Larson Author-Name: Paul J. Herz Author-X-Name-First: Paul J. Author-X-Name-Last: Herz Title: A Multi-Issue/Multi-Period Analysis of the Geographic Diversity of IASB Comment Letter Participation Abstract: The International Accounting Standards Board (IASB) establishes accounting standards now used in some form in over 100 countries. Diverse geographical participation in International Financial Reporting Standards (IFRS) standard-setting is seen as desirable as it may improve the consistency of IFRS applications, reduce criticism of regional over-influence, and promote the legitimacy of the IASB. This study investigates country participation and the regional and institutional factors that influence the geographic diversity of comment letters (CLs) in the IASB's standard-setting process. Using CLs regarding 57 IASB issues from 2001 through 2008, we find that countries with EU membership, G4+1 membership, donations to the IASB, and larger equity market development are associated with larger numbers of CLs and CL writers. Analysis of a subsample of more developed countries finds some evidence that countries with more historic divergence in accounting standards from IFRS also have more CL writers. In most countries, one of several major stakeholder interest groups, such as professional accountancy bodies, accounting standard-setters, and public accounting firms, send at least half of the CLs. While response levels for most countries vary greatly depending upon the nature or topic of an IASB issue, overall response levels remain low at just over 100 responses per issue and did not increase over time. While geographic diversity and response rates are greater than its predecessor the International Accounting Standards Committee, they are lower than those of many national standard-setters, possibly raising due process and legitimacy issues for the IASB. Journal: Accounting in Europe Pages: 99-151 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772716 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772716 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:99-151 Template-Type: ReDIF-Article 1.0 Author-Name: M. Federica Izzo Author-X-Name-First: M. Federica Author-X-Name-Last: Izzo Title: Corporate Social Strategy Journal: Accounting in Europe Pages: 153-156 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772723 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772723 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:153-156 Template-Type: ReDIF-Article 1.0 Author-Name: Chris Mallin Author-X-Name-First: Chris Author-X-Name-Last: Mallin Title: Corporate Governance of Non-Listed Companies Journal: Accounting in Europe Pages: 156-158 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.772719 File-URL: http://hdl.handle.net/10.1080/17449480.2013.772719 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:156-158 Template-Type: ReDIF-Article 1.0 Author-Name: Jieun Chung Author-X-Name-First: Jieun Author-X-Name-Last: Chung Title: Corporate Responsibility Journal: Accounting in Europe Pages: 159-161 Issue: 1 Volume: 10 Year: 2013 Month: 6 X-DOI: 10.1080/17449480.2013.774732 File-URL: http://hdl.handle.net/10.1080/17449480.2013.774732 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:1:p:159-161 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Title: Accounting in Europe -- 10 years on Journal: Accounting in Europe Pages: 163-173 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.840425 File-URL: http://hdl.handle.net/10.1080/17449480.2013.840425 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:163-173 Template-Type: ReDIF-Article 1.0 Author-Name: Nicole V. S. Ratzinger-Sakel Author-X-Name-First: Nicole V. S. Author-X-Name-Last: Ratzinger-Sakel Author-Name: Sophie Audousset-Coulier Author-X-Name-First: Sophie Author-X-Name-Last: Audousset-Coulier Author-Name: Jaana Kettunen Author-X-Name-First: Jaana Author-X-Name-Last: Kettunen Author-Name: Cédric Lesage Author-X-Name-First: Cédric Author-X-Name-Last: Lesage Title: Joint Audit: Issues and Challenges for Researchers and Policy-Makers Abstract: AbstractThe publication of the European Commission Green Paper, 'Audit Policy: Lessons from the Crisis' in October 2010, has stirred up a lively debate on the role of joint audits. This literature review identifies and evaluates, for the benefit of future research and regulators, existing evidence about joint audits. We find limited empirical support to suggest that joint audits lead to increased audit quality, but some empirical support to suggest that joint audits lead to additional costs. Overall, this paper indicates that joint audit should be seen as a mechanism that is embedded in a broader institutional context and not be considered in isolation from other factors that might impact the audit market. The results indicate that various country-level characteristics are simultaneously at play. While joint audits can potentially enhance the audit market competition by allowing smaller audit firms to maintain larger market shares, the related impact on audit quality has not yet been clearly demonstrated and thus provides a promising avenue for future research. Journal: Accounting in Europe Pages: 175-199 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834725 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834725 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:175-199 Template-Type: ReDIF-Article 1.0 Author-Name: Martin Schmidt Author-X-Name-First: Martin Author-X-Name-Last: Schmidt Title: Equity and Liabilities -- A Discussion of IAS 32 and a Critique of the Classification Abstract: AbstractIt is a traditional convention in accounting to distinguish between two classes of claims, liabilities and equity. The International Accounting Standards Board and the Financial Accounting Standards Board have been using a dichotomous classification approach, adhering to this convention. However, over the recent years, this approach has been put under stress. First, there is an ever-growing variety of hybrid financial instruments, some of which designed to exploit this classification approach (accounting arbitrage). Second, the adoption of IFRS in Europe and elsewhere has brought scenarios to light in which the classification approach does not result in decision-useful information. These issues arise when IFRS are applied by entities in legal forms other than a private or public limited company. This essay discusses IAS 32 in the light of the historic origins of the dichotomous classification approach, the recent standard-setting activities and a review of the empirical research. This essay suggests that a reconsideration of the traditional dichotomous classification might be a way forward. Journal: Accounting in Europe Pages: 201-222 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834727 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834727 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:201-222 Template-Type: ReDIF-Article 1.0 Author-Name: Celeste M. Black Author-X-Name-First: Celeste M. Author-X-Name-Last: Black Title: Accounting for Carbon Emission Allowances in the European Union: In Search of Consistency Abstract: AbstractWith the commencement of Phase III of the European Union Emissions Trading System (EU ETS) in 2013, it is projected that approximately one-half of emission allowances will be acquired through auctioning and the provision of free allocations to installations will be substantially tightened. As a result, it is likely that many companies will hold purchased (as opposed to freely allocated or gratis) allowances and will have more significant liabilities under the scheme. The accounting treatment of emission allowances has therefore become more relevant and the lack of uniformity in practice that resulted after the withdrawal of IFRIC 3 is now a more pressing concern. This study uses content analysis to examine disclosed accounting policies of companies with significant emission liabilities under the EU ETS and identifies three more common approaches adopted to date. These can be generally described as the following: (i) a net liability approach, based on the classification of allowances as intangibles but only showing an emission liability when it exceeds the free allocation; (ii) an approach broadly based on IFRIC 3 (recognising the free allocation at fair value and a corresponding gross liability under the EU ETS); and (iii) an approach based on inventory classification, with free allocations given at nil value. The diversity in these treatments highlights the need for guidance from the International Accounting Standards Board. Journal: Accounting in Europe Pages: 223-239 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834730 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834730 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:223-239 Template-Type: ReDIF-Article 1.0 Author-Name: Erlend Kvaal Author-X-Name-First: Erlend Author-X-Name-Last: Kvaal Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: International Variations in Tax Disclosures Abstract: AbstractWe examine the tax disclosures of 161 large IFRS-reporting companies in five countries by studying in detail how they carry out two numerical reconciliations mandated by IAS 12. Using a variety of approaches, we conclude that there are systematic differences in IFRS reporting practice between companies from different countries. However, we also find varied reporting practices within certain industries such as the extractive industry. Based on our observations, we question whether the requirements of the present standard are sufficiently explicit and concise to lead to understandable and comparable tax disclosures. We identify a number of elements of IAS 12 that could be improved. Journal: Accounting in Europe Pages: 241-273 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834733 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834733 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:241-273 Template-Type: ReDIF-Article 1.0 Author-Name: Mara Cameran Author-X-Name-First: Mara Author-X-Name-Last: Cameran Title: Reaching Key Financial Reporting Decisions: How Directors and Auditors Interact Journal: Accounting in Europe Pages: 275-277 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834742 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834742 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:275-277 Template-Type: ReDIF-Article 1.0 Author-Name: Alisdair Dobie Author-X-Name-First: Alisdair Author-X-Name-Last: Dobie Title: A History of Management Accounting Journal: Accounting in Europe Pages: 277-279 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834744 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834744 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:277-279 Template-Type: ReDIF-Article 1.0 Author-Name: Alice Rose Bryer Author-X-Name-First: Alice Rose Author-X-Name-Last: Bryer Title: Understanding Regulation: Theory, Strategy, and Practice Journal: Accounting in Europe Pages: 279-282 Issue: 2 Volume: 10 Year: 2013 Month: 11 X-DOI: 10.1080/17449480.2013.834747 File-URL: http://hdl.handle.net/10.1080/17449480.2013.834747 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:10:y:2013:i:2:p:279-282 Template-Type: ReDIF-Article 1.0 Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Title: A New Team Journal: Accounting in Europe Pages: 1-3 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.903629 File-URL: http://hdl.handle.net/10.1080/17449480.2014.903629 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:1-3 Template-Type: ReDIF-Article 1.0 Author-Name: Alan Teixeira Author-X-Name-First: Alan Author-X-Name-Last: Teixeira Title: The International Accounting Standards Board and Evidence-Informed Standard-Setting Abstract: This commentary describes some of the steps that the International Accounting Standards Board (IASB) is taking to develop its research programme and draw on the work and people in the broader research community. I think it is important that we move even further away from decision-making based on assertions to more evidence-informed standard-setting. However, such a move has risks, including potentially giving IASB members an unjustified sense that they have 'proof' that they are making the right decisions. The IASB is aware of those risks and the limitations in using the extant literature in standard-setting. The IASB is developing ways to reduce these risks and overcome these limitations. However, real progress also needs the accounting research community to make some changes, and they need to want to change. Journal: Accounting in Europe Pages: 5-12 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.900269 File-URL: http://hdl.handle.net/10.1080/17449480.2014.900269 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:5-12 Template-Type: ReDIF-Article 1.0 Author-Name: Yuri Biondi Author-X-Name-First: Yuri Author-X-Name-Last: Biondi Author-Name: Eiko Tsujiyama Author-X-Name-First: Eiko Author-X-Name-Last: Tsujiyama Author-Name: Jonathan Glover Author-X-Name-First: Jonathan Author-X-Name-Last: Glover Author-Name: Nicole T. Jenkins Author-X-Name-First: Nicole T. Author-X-Name-Last: Jenkins Author-Name: Bjorn Jorgensen Author-X-Name-First: Bjorn Author-X-Name-Last: Jorgensen Author-Name: John Lacey Author-X-Name-First: John Author-X-Name-Last: Lacey Author-Name: Richard Macve Author-X-Name-First: Richard Author-X-Name-Last: Macve Title: 'Old Hens Make the Best Soup': Accounting for the Earning Process and the IASB/FASB Attempts to Reform Revenue Recognition Accounting Standards Abstract: By developing a synthesis of documents that have been released officially under the revenue recognition project jointly run by the International Accounting Standards Board and Financial Accounting Standards Board, this article points out that the earning generation and realization process over time (that is to say, the traditional accounting model) is in reality still playing an important role without losing its raison d'être. Although this model is supposed to have been consistently rejected since the outset on the premise of the adoption of the assets and liabilities approach amid the Boards' attempt to establish a new revenue recognition model, this article aims to reconfirm the significance and validity of this earning process - that is, the corporate process of generating and realizing earnings over time - as the representational focus of accounting for revenue recognition. Through an internal critique, our article summarizes and discusses successive Boards' proposals under the same asset-liability approach that they have been advocating for revenue recognition. Through a comprehensive comparative analysis (external critique), our article further criticizes the usefulness and feasibility of this approach, especially the transfer-of-control basis of revenue recognition which the Boards propose. It argues then for an alternative approach that combines asset-liability with revenue-expense accounting while re-establishing focus upon the earning process over time. Journal: Accounting in Europe Pages: 13-33 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.903718 File-URL: http://hdl.handle.net/10.1080/17449480.2014.903718 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:13-33 Template-Type: ReDIF-Article 1.0 Author-Name: Elisabetta Barone Author-X-Name-First: Elisabetta Author-X-Name-Last: Barone Author-Name: Jacqueline Birt Author-X-Name-First: Jacqueline Author-X-Name-Last: Birt Author-Name: Soledad Moya Author-X-Name-First: Soledad Author-X-Name-Last: Moya Title: Lease Accounting: A Review of Recent Literature Abstract: Current lease accounting standards classify leases as either operating or finance leases. Operating leases do not require recognition of lease assets or lease liabilities on the balance sheet. Proposed changes to lease accounting would require a lessee to recognise assets and liabilities for most leases over 12 months and may improve the quality and comparability of financial reporting of the entity. In this paper we summarise the literature that can be related, directly or indirectly to the proposed changes by the IASB and the FASB on lease accounting. In summary, the literature highlights that the proposed changes would potentially have economic implications for both preparers and users of accounting reports; including changes to financial ratios, assessment of risk and providing an audit of the accounting reports. Journal: Accounting in Europe Pages: 35-54 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.903630 File-URL: http://hdl.handle.net/10.1080/17449480.2014.903630 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:35-54 Template-Type: ReDIF-Article 1.0 Author-Name: Stephen Zeff Author-X-Name-First: Stephen Author-X-Name-Last: Zeff Title: The IASB and FASB Stumble over the Annuity Method of Depreciation Abstract: In their leases ED issued in May 2013, the IASB and FASB used the annuity method of amortization while at the same time disavowing that they were doing so. Journal: Accounting in Europe Pages: 55-57 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.891380 File-URL: http://hdl.handle.net/10.1080/17449480.2014.891380 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:55-57 Template-Type: ReDIF-Article 1.0 Author-Name: Alessandro Mechelli Author-X-Name-First: Alessandro Author-X-Name-Last: Mechelli Author-Name: Riccardo Cimini Author-X-Name-First: Riccardo Author-X-Name-Last: Cimini Title: Is Comprehensive Income Value Relevant and Does Location Matter? A European Study Abstract: This paper investigates the relative and the incremental value relevance of Comprehensive Income (CI) and Other Comprehensive Income (OCI) across European countries after the mandatory adoption of the International Accounting Standards Board (IASB) standards. This topic, which has already been analysed in other countries, drew the attention of academics and practitioners in Europe after the issuance of International Accounting Standard 1-revised, which requires entities to prepare a statement of comprehensive income (SOCI) in which both CI and OCI components are disclosed. The investigation of the value relevance of accounting amounts is important in order to evaluate their usefulness, because it highlights whether they reflect information investors use in making economic decisions. This study analyses a sample made of all the European listed entities of countries belonging to the EU at the date of issuance of EU Regulation 1606/2002. Our analysis involves a period from 2006 to 2011 and includes 16,511 firm-year observations. Our results show that Net Income (NI) is more value-relevant than CI, even though the total OCI of the period adds relevant information to those already disclosed in other accounting items such as NI and Book Value. In this regard, we found that the coefficient of the total OCI of the period is lower than that of NI, a result to be expected because of its transitory nature. Our findings also suggest that the requirement to issue an SOCI has not produced a significant change in the value relevance of both CI and the total OCI of the period leading to the conclusion that its location does not affect the value relevance of these items. Finally, we found significant differences in the incremental value relevance of the total OCI of the period across European countries, differences that seem to be caused by the countries' characteristics, such as the source of funds (credit/equity and insider/outsider) and the legal systems. Journal: Accounting in Europe Pages: 59-87 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.890777 File-URL: http://hdl.handle.net/10.1080/17449480.2014.890777 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:59-87 Template-Type: ReDIF-Article 1.0 Author-Name: Urska Kosi Author-X-Name-First: Urska Author-X-Name-Last: Kosi Author-Name: Antonia Reither Author-X-Name-First: Antonia Author-X-Name-Last: Reither Title: Determinants of Corporate Participation in the IFRS 4 (Insurance Contracts) Replacement Process Abstract: This study examines the determinants of financial firms' lobbying behaviour in the replacement process of International Financial Reporting Standard 4 (IFRS 4) Insurance Contracts. Based on comment letters in response to International Accounting Standards Board's (IASB) Exposure Draft 2010/8, we investigate firms' lobbying decisions and their long-term lobbying intensity. Using an international sample of publicly listed financial firms, we show that insurance companies and financially constrained IFRS firms are more likely to lobby the IASB. We also examine the long-term lobbying activity in the IFRS 4 replacement process during the years 2007-2010. We find that insurance companies and firms with dispersed ownership lobby more. Our results are stronger for IFRS firms compared to US generally accepted accounting principles users. Overall, we document intense lobbying by financial firms and present results that are largely consistent with economic consequences of anticipated accounting changes being the main driver of firms' lobbying behaviour. These results are in line with prior findings for non-financial firms. Journal: Accounting in Europe Pages: 89-112 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.897459 File-URL: http://hdl.handle.net/10.1080/17449480.2014.897459 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:89-112 Template-Type: ReDIF-Article 1.0 Author-Name: Rucsandra Moldovan Author-X-Name-First: Rucsandra Author-X-Name-Last: Moldovan Title: Post-Implementation Reviews for IASB and FASB Standards: A Comparison of the Process and Findings for the Operating Segments Standards Abstract: The International Accounting Standards Board (IASB) and the Financial Accounting Foundation (FAF) have recently completed post-implementation reviews (PIRs) for their converged standards on operating segments IFRS 8 and SFAS 131. The two accounting bodies use PIRs as an additional standard assessment mechanism. This paper (1) provides an overview of the main differences and similarities between the two PIR processes and (2) compares the findings of the PIRs on the operating segment standards supplemented with insights from a survey of the segment information notes of a sample of STOXX Europe 600 companies. The IASB and the FAF set the specific PIR objectives and conduct the information gathering phase differently. For the IFRS 8 and SFAS 131 PIRs, these differences meant that the FAF focused more narrowly on how SFAS 131 performs compared to the previous standard, while the IASB is aimed to more broadly assess constituents' views on whether IFRS 8 works well in practice. Comparing the PIR findings for the operating segments standards is warranted given that the standards are converged and that the standard setters re-expressed their commitment to keep them substantially converged. Uniform PIR processes could have eased the cooperation in maintaining convergence. Given the different scope of the reviews, standard setters will need to find a common ground on how to proceed and which issues to address further. Journal: Accounting in Europe Pages: 113-137 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.901588 File-URL: http://hdl.handle.net/10.1080/17449480.2014.901588 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:113-137 Template-Type: ReDIF-Article 1.0 Author-Name: Mark A. Clatworthy Author-X-Name-First: Mark A. Author-X-Name-Last: Clatworthy Title: Financial Statement Fraud Casebook: Baking the Ledgers and Cooking the Books Journal: Accounting in Europe Pages: 139-141 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.908531 File-URL: http://hdl.handle.net/10.1080/17449480.2014.908531 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:139-141 Template-Type: ReDIF-Article 1.0 Author-Name: Lino Cinquini Author-X-Name-First: Lino Author-X-Name-Last: Cinquini Title: Accounting and Order Journal: Accounting in Europe Pages: 141-144 Issue: 1 Volume: 11 Year: 2014 Month: 6 X-DOI: 10.1080/17449480.2014.908532 File-URL: http://hdl.handle.net/10.1080/17449480.2014.908532 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:1:p:141-144 Template-Type: ReDIF-Article 1.0 Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Title: Towards a New Conceptual Framework: Here We Go Again! Journal: Accounting in Europe Pages: 145-147 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.967790 File-URL: http://hdl.handle.net/10.1080/17449480.2014.967790 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:145-147 Template-Type: ReDIF-Article 1.0 Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Author-Name: Andrew Lennard Author-X-Name-First: Andrew Author-X-Name-Last: Lennard Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Author-Name: Marco Trombetta Author-X-Name-First: Marco Author-X-Name-Last: Trombetta Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Response of the EAA Financial Reporting Standards Committee to the IASB Discussion Paper A Review of the Conceptual Framework for Financial Reporting Abstract: The European Accounting Association (EAA) Financial Reporting Standards Committee (FRSC) provided a response to the International Accounting Standards Board's (IASB's) 2013 Discussion Paper (DP) on completing and revising its Conceptual Framework. The response consisted of a literature-based discussion of the issues raised in the IASB paper and responses to the questions asked. The following paper has omitted the responses to specific questions but otherwise sets out the arguments made to the IASB, together with introductory material to indicate the context. The FRSC paper follows the order of the IASB DP. Journal: Accounting in Europe Pages: 149-184 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.940356 File-URL: http://hdl.handle.net/10.1080/17449480.2014.940356 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:149-184 Template-Type: ReDIF-Article 1.0 Author-Name: Stefano Cascino Author-X-Name-First: Stefano Author-X-Name-Last: Cascino Author-Name: Mark Clatworthy Author-X-Name-First: Mark Author-X-Name-Last: Clatworthy Author-Name: Beatriz García Osma Author-X-Name-First: Beatriz Author-X-Name-Last: García Osma Author-Name: Joachim Gassen Author-X-Name-First: Joachim Author-X-Name-Last: Gassen Author-Name: Shahed Imam Author-X-Name-First: Shahed Author-X-Name-Last: Imam Author-Name: Thomas Jeanjean Author-X-Name-First: Thomas Author-X-Name-Last: Jeanjean Title: Who Uses Financial Reports and for What Purpose? Evidence from Capital Providers Abstract: We review the academic literature on the use of financial reporting information by capital providers. We classify our findings by investor type and by information objective. While most capital providers use accounting information, our survey indicates that they do so in a variety of ways with financial reporting information competing with other sources of information. We also find that information intermediaries are influential in both credit and equity markets, making the identification of a typical target 'user' inherently difficult. Our main findings question the underlying objective of the Conceptual Framework to guide the development of standards for general-purpose financial statements to provide a typical knowledgeable investor with a true and fair view about the reporting entity. Finally, we identify gaps in the literature and suggest areas where future research can help inform important academic and policy debates. Journal: Accounting in Europe Pages: 185-209 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.940355 File-URL: http://hdl.handle.net/10.1080/17449480.2014.940355 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:185-209 Template-Type: ReDIF-Article 1.0 Author-Name: Andrew M. Bauer Author-X-Name-First: Andrew M. Author-X-Name-Last: Bauer Author-Name: Patricia C. O'Brien Author-X-Name-First: Patricia C. Author-X-Name-Last: O'Brien Author-Name: Umar Saeed Author-X-Name-First: Umar Author-X-Name-Last: Saeed Title: Reliability Makes Accounting Relevant: A Comment on the IASB Conceptual Framework Project Abstract: In July 2013, the International Accounting Standards Board (IASB) welcomed comments to their discussion paper A Review of the Conceptual Framework for Financial Reporting. We argue that the IASB should revisit its decisions about the concepts of reliability and prudence, to address the inherent accounting issue of moral hazard. Within the contexts of goodwill and securitization accounting, we illustrate how reliability and prudence can help standard-setters to identify standards that can address moral hazard. We further illustrate the pervasiveness of moral hazard, using the context of executive compensation arrangements. Ultimately, we conclude that a strong conceptual framework should enhance the credibility of financial reporting. We view this as the fundamental role of accounting. Journal: Accounting in Europe Pages: 211-217 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.967789 File-URL: http://hdl.handle.net/10.1080/17449480.2014.967789 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:211-217 Template-Type: ReDIF-Article 1.0 Author-Name: Carien van Mourik Author-X-Name-First: Carien Author-X-Name-Last: van Mourik Title: The Equity Theories and the IASB Conceptual Framework Abstract: The International Accounting Standards Board (IASB) staff members 'recommend that the IASB confirm its view that financial statements should be presented from the perspective of the entity as a whole' [IASB (2014) Agenda Paper 10E Project - The Conceptual Framework. Reporting Entity - Perspective. London: The International Accounting Standards Board. May 2014. Available at: http://www.ifrs.org/Meetings/MeetingDocs/IASB/2014/May/AP10E-Conceptual%20 Framework.pdf (accessed 9 July 2014), para. 28], which implies adoption of the Entity Theory. This paper explains the value judgements and arguments supporting the main equity theories and their perspectives on financial performance and financial position. It identifies Residual Equity Theory, instead of Entity Theory, as the dominant equity theory in the 2010 IASB Framework and the 2013 IASB Exposure Draft. Hence, there is a discrepancy between the perspective from which the IASB thinks financial statements should be presented and the perspective actually underlying the definition, recognition and measurement of the elements of financial statements in the IASB's Framework and Exposure Draft. Finally, this paper argues for a careful reconsideration and justification of the equity theory the IASB chooses as the basis for its Conceptual Framework. Journal: Accounting in Europe Pages: 219-233 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.949278 File-URL: http://hdl.handle.net/10.1080/17449480.2014.949278 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:219-233 Template-Type: ReDIF-Article 1.0 Author-Name: Arjan Brouwer Author-X-Name-First: Arjan Author-X-Name-Last: Brouwer Author-Name: Arshia Faramarzi Author-X-Name-First: Arshia Author-X-Name-Last: Faramarzi Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Title: Does the New Conceptual Framework Provide Adequate Concepts for Reporting Relevant Information about Performance? Abstract: The basic question we raise in this paper is whether the 2013 Discussion Paper (DP 2013) on the Conceptual Framework provides adequate principles for reporting an entity's performance and what improvements could be made in the light of both user needs and evidence from academic literature. DP 2013 proposes to continue applying a balance sheet approach to financial accounting, whereby the income statement serves as a statement explaining changes in an entity's financial position. Performance is reduced to a discussion of possible approaches to defining other comprehensive income items and recycling. We conclude that the literature supports a more refined approach to communicating relevant attributes of performance, defining performance independently from assets and liabilities and taking into account various relevant disaggregations within profit or loss. We therefore propose a more balanced approach to financial reporting whereby the balance sheet and income statement are treated as equally important and the income statement gives more information about various relevant attributes of performance. Journal: Accounting in Europe Pages: 235-257 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.967788 File-URL: http://hdl.handle.net/10.1080/17449480.2014.967788 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:235-257 Template-Type: ReDIF-Article 1.0 Author-Name: Mario Abela Author-X-Name-First: Mario Author-X-Name-Last: Abela Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Author-Name: Rasmus Sommer Author-X-Name-First: Rasmus Author-X-Name-Last: Sommer Author-Name: Alan Teixeira Author-X-Name-First: Alan Author-X-Name-Last: Teixeira Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Title: Towards a New Conceptual Framework: Presentations at the Accounting in Europe and European Accounting Association Financial Reporting Standards Committee Symposium Abstract: A symposium at the European Accounting Association (EAA) Annual Meetings on Friday 23 May 2014 in Tallinn, organised by Accounting in Europe and the EAA's Financial Reporting Standards Committee (FRSC), brought together leading respondents to the Discussion Paper and the International Accounting Standards Board to debate the issues surrounding the new Conceptual Framework. This paper reproduces the presentations from the panellists: Mario Abela, Leader, Research and Development, International Federation of Accountants (IFAC); Richard Barker, Saïd Business School, Oxford University & EAA FRSC; Rasmus Sommer, Senior Technical Manager, European Financial Reporting Advisory Group (EFRAG); and Alan Teixeira, Senior Director - Technical Activities, International Accounting Standards Board (IASB). The panel was chaired by Paul André, ESSEC Business School & Editor Accounting in Europe. Journal: Accounting in Europe Pages: 259-271 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.959977 File-URL: http://hdl.handle.net/10.1080/17449480.2014.959977 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:259-271 Template-Type: ReDIF-Article 1.0 Author-Name: Antti Miihkinen Author-X-Name-First: Antti Author-X-Name-Last: Miihkinen Title: The Routledge Companion to Accounting, Reporting and Regulation Journal: Accounting in Europe Pages: 273-277 Issue: 2 Volume: 11 Year: 2014 Month: 12 X-DOI: 10.1080/17449480.2014.967791 File-URL: http://hdl.handle.net/10.1080/17449480.2014.967791 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:11:y:2014:i:2:p:273-277 Template-Type: ReDIF-Article 1.0 Author-Name: Kees Camfferman Author-X-Name-First: Kees Author-X-Name-Last: Camfferman Title: The Emergence of the 'Incurred-Loss' Model for Credit Losses in IAS 39 Abstract: Following the financial crisis, the view became widespread that International Financial Reporting Standards (IFRS), because it is based on a so-called incurred-loss approach, led to significant overstatements of financial assets by placing tight restrictions on the recognition of loan losses. As a result, the International Accounting Standards Board (IASB) undertook a project to introduce an alternative expected-loss model in its standards, which would allow earlier recognition of loan losses. This paper is a historical study of the introduction of the incurred-loss model in International Accounting Standard (IAS) 39 between 1998 and 2003. With respect to the topic of loan losses, it argues that, especially at the beginning of that period, it was not yet common to view the issue in terms of a clear-cut dichotomy of incurred-loss versus expected-loss models, and that this had a significant complicating influence on the course of the debate. More generally, the paper illustrates some of the pressures on the quality of the Board's due process during its early years, when it attempted to complete an ambitious agenda in time for the first mass adoption of IFRS in 2005. While this paper takes no position on the correctness of the IASB's decisions as embodied in IAS 39 (2003), it does suggest that the episode covered provides justification for the considerable enhancements of its due process effected by the IASB over recent years. Journal: Accounting in Europe Pages: 1-35 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1012526 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1012526 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:1-35 Template-Type: ReDIF-Article 1.0 Author-Name: Mark Aleksanyan Author-X-Name-First: Mark Author-X-Name-Last: Aleksanyan Author-Name: Jo Danbolt Author-X-Name-First: Jo Author-X-Name-Last: Danbolt Title: Segment Reporting: Is IFRS 8 Really Better? Abstract: This paper contributes to the debate on segment reporting standards in the UK and Europe and, specifically, the merit of International Financial Reporting Standard (IFRS) 8 relative to predecessor standards (Statement of Standard Accounting Practice (SSAP) 25 and International Accounting Standard (IAS) 14R). We carry out a longitudinal analysis of segment reporting practices of a large sample of listed UK companies, covering all three reporting regimes. Using the proprietary cost theory (PCT) as our theoretical lens, we present evidence consistent with PCT, that proprietary costs considerations influence companies' segment disclosure choices. We show that when companies are required to disclose more detailed accounting information for geographical segments (e.g. when geography is the basis of operating segments, under IFRS 8, or primary segments, under IAS 14R), they choose to define geographical segments in broader geographic areas terms than was the case under SSAP 25. We find that although companies disclose greater quantity of segmental information under IFRS 8 and IAS 14R (than SSAP 25), the more recent standards brought about a notable reduction in (i) the level of specificity of the disclosed geographical segments, and (ii) the quantity of disclosed geographic segment profit data - one of the most important data types for users. While this may have reduced the proprietary costs of segment disclosures, the reduction in disclosure of segmental performance data may have reduced the usefulness of segment reports to investors. Journal: Accounting in Europe Pages: 37-60 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1027239 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1027239 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:37-60 Template-Type: ReDIF-Article 1.0 Author-Name: Nicole V.S. Ratzinger-Sakel Author-X-Name-First: Nicole V.S. Author-X-Name-Last: Ratzinger-Sakel Author-Name: Martin W. Schönberger Author-X-Name-First: Martin W. Author-X-Name-Last: Schönberger Title: Restricting Non-Audit Services in Europe - The Potential (Lack of) Impact of a Blacklist and a Fee Cap on Auditor Independence and Audit Quality Abstract: The European audit reform aims to stabilize financial markets by enhancing trust in the statutory audit. To strengthen auditor independence and to increase audit quality, the provision of non-audit services to audit clients is further restricted. The supranational introduction of a blacklist, including prohibited non-audit services, and of a cap on the volume of non-audit fees is a novelty on the European level. The purpose of this paper is threefold. First, we analyze these measures in light of both current national restrictions of non-audit services and auditor fee disclosure requirements in France, Germany and the UK. Second, we assess the potential impact of the cap on the volume of non-audit services by providing descriptive evidence on current fee levels in these three countries. Third, we critically assess the impact of the audit reform regarding non-audit services in light of audit research by analyzing the state of the art. On this basis, we doubt whether the European reform of auditor-provided non-audit services is effective and efficient. The main goal of enhancing perceived auditor independence and, thus, public trust in audited financial statements of public-interest entities may be hardly achieved and the blacklist might present a tradeoff between auditor independence and audit quality. Journal: Accounting in Europe Pages: 61-86 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1035290 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1035290 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:61-86 Template-Type: ReDIF-Article 1.0 Author-Name: Claire Gillet-Monjarret Author-X-Name-First: Claire Author-X-Name-Last: Gillet-Monjarret Title: Assurance of Sustainability Information: A Study of Media Pressure Abstract: This research examines sustainability assurance practices and more specifically whether media pressure influences companies' decision to implement a voluntary sustainability assurance. The sample consists of companies listed on the French SBF 120 over a period of four years (2007-2010). The study conducts logistic regressions with longitudinal panel data to empirically test the influence of explanatory factors on the use of sustainability assurance. It appears that the variables related to media pressure explain the establishment of sustainability assurance. Moreover, the size of the company, the industry and the positioning of companies in corporate social responsibility also influence the use of assurance of sustainability information. On the theoretical level, the research contributes to a better understanding of practices of sustainability assurance by offering an explanatory model of this practice. On a managerial level, it contributes to the understanding of corporate behavior. This research may allow users of sustainability information to judge the relevance of sustainability reporting. Journal: Accounting in Europe Pages: 87-105 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1036894 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1036894 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:87-105 Template-Type: ReDIF-Article 1.0 Author-Name: Gero Holthoff Author-X-Name-First: Gero Author-X-Name-Last: Holthoff Author-Name: Florian Hoos Author-X-Name-First: Florian Author-X-Name-Last: Hoos Author-Name: Barbara E. Weissenberger Author-X-Name-First: Barbara E. Author-X-Name-Last: Weissenberger Title: Are We Lost in Translation? The Impact of Using Translated IFRS on Decision-Making Abstract: International Financial Reporting Standards (IFRS) are issued in English and subsequently translated into a multitude of languages to make them accessible to non-English-speaking IFRS users. In an international work context, IFRS users apply either the original English version or a translated version of an IFRS standard to input information presented in different languages. While research has reported numerous challenges inherent in IFRS translation, we know very little about the actual impact of using different languages on decision-making. Based on a series of 2 × 2 between-subjects experiments with German students who possessed different levels of accounting knowledge, we investigate the influence of language on decision-making. Our experimental manipulations entail the language of the accounting standard used (English vs. German) and the language of the input case information (English vs. German). Our German participants made decisions about a series of cases relating to IAS 24 Related Party Disclosures. Based on an expert benchmark solution for the cases, we determine the quality of participants' decisions. We find that the use of IAS 24 in the participants' mother tongue (German) has a positive impact on decision-making quality. We also find some support for a positive influence of the native language of the input case information relative to English input case information. Moreover, participants' accounting knowledge and English language skill are positively associated with decision-making quality. Journal: Accounting in Europe Pages: 107-125 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1052824 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1052824 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:107-125 Template-Type: ReDIF-Article 1.0 Author-Name: Roberto Di Pietra Author-X-Name-First: Roberto Author-X-Name-Last: Di Pietra Title: The Nature of Accounting Regulation Journal: Accounting in Europe Pages: 127-133 Issue: 1 Volume: 12 Year: 2015 Month: 6 X-DOI: 10.1080/17449480.2015.1054114 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1054114 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:1:p:127-133 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: IFRS in Europe -- An Observer's Perspective of the Next 10 Years Abstract: What follows is a personal reflection on the challenges that may face the International Financial Reporting Standards (IFRS) Foundation in the next 10 years, and is based on two conference presentations and the debate at those conferences. The suggestion is that the character of the members of the International Accounting Standards Board (IASB) in its second decade is different from that of the founding board, and is more pragmatic than crusading. It is mooted that the board will need to address second-order issues of the organisation and policy, and that Europe will try to take a more influential role. The article observes that existing issues of funding, complexity and differential reporting may become more urgent and will need to be addressed for the organisation to continue to evolve. Journal: Accounting in Europe Pages: 135-151 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1095306 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1095306 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:135-151 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: IFRS Ten Years on: Has the IASB Imposed Extensive Use of Fair Value? Has the EU Learnt to Love IFRS? And Does the Use of Fair Value make IFRS Illegal in the EU? Abstract: This paper is a commentary on issues related to the first decade's mandatory use of International Financial Reporting Standards (IFRSs) in the EU. Three specific but related questions are addressed, as in the paper's title. On the first (imposition and use of fair value (FV)), I conclude that the International Accounting Standards Board has not substantially extended the use of FV in its 15 years of work and that most companies hold few assets or liabilities on the FV basis. On the second question (adoption in the EU), I analyse a consultation exercise which strongly suggests that the EU's imposition of IFRSs will continue. On the third question (legality of IFRSs), I explain why recent UK legal opinions that question the legality of reporting under IFRSs are not persuasive. Journal: Accounting in Europe Pages: 153-170 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1114656 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1114656 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:153-170 Template-Type: ReDIF-Article 1.0 Author-Name: Brian Singleton-Green Author-X-Name-First: Brian Author-X-Name-Last: Singleton-Green Title: Public Policy and Accounting Research: What Is to Be Done? Abstract: Singleton-Green [2010. The communication gap: Why doesn't accounting research make a greater contribution to debates on accounting policy? Accounting in Europe, 7(2), 129--145] argues that a communication gap between researchers and those involved in public debates on accounting problems significantly reduces the impact of accounting research. A new ICAEW report, The Effects of Mandatory IFRS Adoption in the EU: a Review of Empirical Research, tries to bridge the communication gap on the subject that it covers. The report found not only a significant amount of relevant research, but also that its usefulness was limited in various ways. The paper makes a number of recommendations to researchers: they should point out any biases in the data they use, address some issues through field work, not assume that surrounding institutions are unchanged, be careful to understand the specific features of the countries they cover, investigate differences in previous research, and state the economic significance of their findings. The paper also makes recommendations for non-academic participants in public policy debates, including: they should actively promote relevant research, help researchers get access to information, and help ensure that researchers have the incentives to do what is needed to benefit public policy. Journal: Accounting in Europe Pages: 171-186 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1107680 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1107680 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:171-186 Template-Type: ReDIF-Article 1.0 Author-Name: David Cairns Author-X-Name-First: David Author-X-Name-Last: Cairns Title: Financial Reporting in Europe: Future Challenges Abstract: A roundtable at the 11th workshop of the European Financial Reporting Research Group (EUFIN) on Friday 4 September 2015 in Paris brought together leading participants in the development and enforcement of International Financial Reporting Standards (IFRS) and the use of IFRS financial statements to debate the future challenges in European financial reporting. The panellists were Philippe Danjou, a board member of the International Accounting Standards Board (IASB), Roxana Damianov, team leader for corporate reporting at the European Securities and Markets Authority (ESMA) and Jacques de Greling, senior equity analyst at Natixis, vice-chairman of the European Federation of Financial Analysts Societies (EFFAS) financial accounting commission, member of the IASB's capital markets advisory group and member of the user panel of the European Financial Reporting Advisory Group (EFRAG). The panel was chaired by David Cairns. None of the panellists presented formal papers but instead spoke and debated freely about a range of current and future challenges. Not surprisingly, they focussed on the challenges arising from the use of IFRS in the consolidated financial statements by EU companies listed on EU regulated markets rather than the challenges that might arise from the use of EU or national requirements in non-IFRS financial statements.This paper provides a synthesis of the panel discussions in the context of the European Commission's evaluation of the International Accounting Standards (IAS) Regulation, the International Financial Reporting Standards Foundation's (IFRSF) review of its own and the IASB's structure and effectiveness, and the ongoing work of the IASB and ESMA. Journal: Accounting in Europe Pages: 187-196 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1114181 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1114181 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:187-196 Template-Type: ReDIF-Article 1.0 Author-Name: Lisa Weaver Author-X-Name-First: Lisa Author-X-Name-Last: Weaver Author-Name: Margaret Woods Author-X-Name-First: Margaret Author-X-Name-Last: Woods Title: The Challenges Faced by Reporting Entities on Their Transition to International Financial Reporting Standards: A Qualitative Study Abstract: This study explores the challenges of implementing International Financial Reporting Standards (IFRS) at the organisational level. Based on interviews with experts with aggregated experience relating to the transition projects of over 170 reporting entities, this paper highlights the main challenges in delivering a successful implementation of IFRS. The findings show that the problems faced in implementation include lack of education and training, securing executive-level support, identifying and responding to the wider business-related implications of the transition, and issues with capturing the necessary information for reporting under IFRS.This paper complements the existing literature and offers a qualitative alternative to considering the transition to IFRS, offering insight into the organisational context of IFRS implementation. These insights are useful not only from a historic perspective, but also for organisations and regulators in the many jurisdictions where IFRS is permitted but not required, where more reporting entities will voluntarily move to IFRS-based reporting in the future. More broadly, they are also applicable to the challenges faced in implementing new and significantly revised IFRSs. Journal: Accounting in Europe Pages: 197-221 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1103376 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1103376 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:197-221 Template-Type: ReDIF-Article 1.0 Author-Name: Isabel Costa Lourenço Author-X-Name-First: Isabel Costa Author-X-Name-Last: Lourenço Author-Name: Raquel Sarquis Author-X-Name-First: Raquel Author-X-Name-Last: Sarquis Author-Name: Manuel Castelo Branco Author-X-Name-First: Manuel Castelo Author-X-Name-Last: Branco Author-Name: Cláudio Pais Author-X-Name-First: Cláudio Author-X-Name-Last: Pais Title: Extending the Classification of European Countries by their IFRS Practices: A Research Note Abstract: This paper expands the IFRS accounting systems’ classification proposed by Nobes [(2011). IFRS practices and the persistence of accounting system classification. Abacus, 47(3), 267--283] to a broader set of European countries. The results suggest a classification distinguishing between four groups of European countries, and add to the evidence, reported by Kvaal and Nobes [(2010). International differences in IFRS policy choice. Accounting and Business Research, 40(2), 173--187] and Nobes (2011)., that pre-IFRS accounting differences influence the options adopted by firms. This study contributes to the literature suggesting that the widespread adoption of IFRS has not eliminated the differences between national accounting practices and that accounting systems classification did not lose its relevance. Journal: Accounting in Europe Pages: 223-232 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1111520 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1111520 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:223-232 Template-Type: ReDIF-Article 1.0 Author-Name: Andreas Charitou Author-X-Name-First: Andreas Author-X-Name-Last: Charitou Title: Corporate Governance and Initial Public Offerings: An International Perspective Journal: Accounting in Europe Pages: 233-234 Issue: 2 Volume: 12 Year: 2015 Month: 12 X-DOI: 10.1080/17449480.2015.1115114 File-URL: http://hdl.handle.net/10.1080/17449480.2015.1115114 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:12:y:2015:i:2:p:233-234 Template-Type: ReDIF-Article 1.0 Author-Name: Juha Mäki Author-X-Name-First: Juha Author-X-Name-Last: Mäki Author-Name: Antonio Somoza-Lopez Author-X-Name-First: Antonio Author-X-Name-Last: Somoza-Lopez Author-Name: Stefan Sundgren Author-X-Name-First: Stefan Author-X-Name-Last: Sundgren Title: Ownership Structure and Accounting Method Choice: A Study of European Real Estate Companies Abstract: Companies can under IAS 40 Investment Properties choose between the fair value and the cost models. The fair value model arguably results in more relevant information but is also more costly to use. Based on studies suggesting that financial reports are a more important medium for communication with investors if ownership is dispersed, we hypothesize that the use of the fair value model is positively associated with ownership dispersion. We study European Real Estate firms and find support for this prediction. We also find a positive association between trade of shares and ownership dispersion, supporting the view that financial statements are less important if ownership concentration is high. Finally, we examine whether the choice depends on the identity of large owners. Companies with a financial company as the largest owner are somewhat more likely to choose the fair value model. Overall, the results indicate that accounting rules facilitating optional accounting policies have benefits. Journal: Accounting in Europe Pages: 1-19 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1154180 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1154180 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:1-19 Template-Type: ReDIF-Article 1.0 Author-Name: Mari Paananen Author-X-Name-First: Mari Author-X-Name-Last: Paananen Author-Name: Annelies Renders Author-X-Name-First: Annelies Author-X-Name-Last: Renders Author-Name: Marita Blomkvist Author-X-Name-First: Marita Author-X-Name-Last: Blomkvist Title: Causes and Consequences of Improvements in the Information Environment for Swedish Small and Mid-Sized Firms Abstract: We investigate improvements in the information environment and financing decisions for Swedish small and mid-sized firms. These firms are required to file audited annual reports. We create an index capturing accounting standards choices, auditor quality, and board size reflecting information environment improvements. We find an association between increased short-term financing and information environment improvements: The most common actions are to switch to a Big 4 auditor or a chartered accountant and to add independent board members as opposed to changing the accounting standards used. These improvements are associated with a switch to long-term debt and a reduction of cost of debt. Our findings are relevant for the ongoing discussion on accounting regulation for private firms both in the USA and Europe since they show that (Swedish) private firms use other ways to improve the information environment in order to access to less costly long-term bank debt besides adopting International Financial Reporting Standards. Journal: Accounting in Europe Pages: 21-42 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1156240 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1156240 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:21-42 Template-Type: ReDIF-Article 1.0 Author-Name: Louise Crawford Author-X-Name-First: Louise Author-X-Name-Last: Crawford Author-Name: Christine Helliar Author-X-Name-First: Christine Author-X-Name-Last: Helliar Author-Name: David Power Author-X-Name-First: David Author-X-Name-Last: Power Title: The temporal nature of legitimation: the case of IFRS8 Abstract: Legitimation can operate on an episodic or continual basis [Suchman, M.C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 20(3), 571--610]. We examine the temporal legitimation of the International Accounting Standards Board (IASB)’s actions during the adoption and review of International Financial Reporting Standard (IFRS) 8 ‘Operating Segments’. We conceptualise the controversy surrounding IFRS8 as an episode when the IASB sought segmental reporting convergence with the US standard, Statement of Financial Accounting Standard 131. Interpreting evidence from 15 (20) semi-structured interviews undertaken in 2009 (2011), before (after) entities reported under IFRS8, reveals its adoption precipitated an episodic legitimacy threat from selected audiences to the actions of the IASB. We discuss the IASB's attempt to influence legitimation for this episode through commitment to a post-implementation review [IFRS Foundation. (2011). Post implementation reviews: Plan for developing the framework for conducting post-implementation reviews. IASB Board meeting February 2011. Retrieved July 27, 2011, from http://www.ifrs.org/NR/rdonlyres/3E1502 E4-F1E8-4907-838B-FFB20C7268ED/0/PIR02111st2ndb04obs.pdf] of IFRS8. Interpreting legitimacy concerns across diverse audiences about specific actions of the IASB (the introduction of IFRS8) enables us to draw conclusions about the resilience of the IASB as a standard setting organisation, in itself. Journal: Accounting in Europe Pages: 43-64 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1160136 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1160136 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:43-64 Template-Type: ReDIF-Article 1.0 Author-Name: Jan Svanberg Author-X-Name-First: Jan Author-X-Name-Last: Svanberg Author-Name: Peter Öhman Author-X-Name-First: Peter Author-X-Name-Last: Öhman Title: Does Ethical Culture in Audit Firms Support Auditor Objectivity? Abstract: The suggested cause of constrained auditor objectivity has been centred on auditors' financial incentives and long audit tenure. Recent research has challenged those assumptions and questioned the effectiveness of auditor rotation to counteract short-tenure threats to auditor objectivity. Audit firms and regulators need to adopt methods for enhancing auditor objectivity that are effective in various auditor--client relationships. This study examines whether audit firm ethical culture is positively related to auditor objectivity. Based on the responses of 281 practising auditors, the findings indicate that auditors are more likely to make objective judgments in ethical cultures characterized by the rewarding of ethical behaviour and punishment of unethical behaviour, prevalence of ethical norms, visible ethical leadership, and low emphasis on obedience to authority. In conclusion, evidence indicates that auditors in audit firms with a strong ethical culture are more likely to maintain auditor objectivity than are auditors in less supportive cultures. This suggests that audit firms should promote a strong ethical culture to reduce the risk of constrained auditor judgment. Journal: Accounting in Europe Pages: 65-79 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1164324 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1164324 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:65-79 Template-Type: ReDIF-Article 1.0 Author-Name: Yuri Biondi Author-X-Name-First: Yuri Author-X-Name-Last: Biondi Title: The HM ‘Treasure's Island’: The Application of Accruals-based Accounting Standards in the UK Government Abstract: Since the 1990s, UK has been progressively adopting a governmental accounting reform purporting to interpret and mimic accounting standards and practices from the private sector. Since 2009, the UK set of accounting standards applicable to the whole of governmental entities is based upon the HM Treasury's official interpretation of the international accounting standards initially designed for commercial enterprises, the latter standards having extensively inspired the International Public Sector Accounting Standards. This article analyses some representational concerns raised by its application of a balance sheet accounting approach to the public administration, pointing to consolidation perimeter, current value measurement of assets and liabilities and the case of public--private partnerships. This theoretical analysis develops relevant implications for representation and control of public spending and borrowing in UK and in general. Journal: Accounting in Europe Pages: 81-102 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1142096 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1142096 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:81-102 Template-Type: ReDIF-Article 1.0 Author-Name: Rafael Heinzelmann Author-X-Name-First: Rafael Author-X-Name-Last: Heinzelmann Title: Comparing Professions in UK and German-Speaking Management Accounting Abstract: This paper studies professional education in management accounting and the ways in which management accounting professions establish jurisdictional claims about management accounting work in the UK and German-speaking countries, respectively. We adopt a comparative approach drawing on the framework of systems of professions and the distinction between public, legal and workplace jurisdiction [Abbott, A. (1988). The system of professions: An essay on the division of expert labor. Chicago, IL: University of Chicago Press]. Our findings highlight some notable differences between the UK and German-speaking countries with respect to professional management accounting education, the jurisdictional claims that the professions make as well as the establishment and history of professional institutes for management accounting. Based on this analysis, the paper identifies a dilemma or at least a challenge for policy-makers with respect to balancing the need for a context-dependent model of professional education with a need for comparability and convergence. Journal: Accounting in Europe Pages: 103-120 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1143560 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1143560 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:103-120 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Aiming for Global Accounting Standards -- The International Accounting Standards Board 2001--2011 Journal: Accounting in Europe Pages: 121-123 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1143958 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1143958 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:121-123 Template-Type: ReDIF-Article 1.0 Author-Name: Marta S. Guerreiro Author-X-Name-First: Marta S. Author-X-Name-Last: Guerreiro Title: The FASB -- The People, the Process, and the Politics (Fifth Edition) Journal: Accounting in Europe Pages: 123-127 Issue: 1 Volume: 13 Year: 2016 Month: 4 X-DOI: 10.1080/17449480.2016.1156717 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1156717 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:1:p:123-127 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Discussion of Barker and Teixeira ([2018]. Gaps in the IFRS Conceptual Framework. Accounting in Europe, 15) and Van Mourik and Katsuo ([2018]. Profit or loss in the IASB Conceptual Framework. Accounting in Europe, 15) Abstract: I provide comments on two papers, Barker and Teixeira ([2018]. Gaps in the IFRS Conceptual Framework. Accounting in Europe, 15) and Van Mourik and Katsuo ([2018]. Profit or loss in the IASB Conceptual Framework. Accounting in Europe, 15), in this issue, which were presented at the EAA-IASB research forum in Brussels. The paper accepts the shortcomings of the updated IASB conceptual framework and argues that these are in large part due to the origins of the document. It points out that the original US project was an attempt to make standard-setting more consistent and involved creating principles which would explain existing standards. Constituents have subsequently resisted attempts to make the framework theoretically sound because they fear this will encourage too much innovation. Standard-setters prefer incremental change, so continue to work with a model created to resolve a problem of the 1970s. I suggest that since standard-setting has been professionalised, the more significant need to is to define what information investors find useful. This may involve providing more granular information about the entity’s business model. Journal: Accounting in Europe Pages: 193-199 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1437457 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1437457 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:193-199 Template-Type: ReDIF-Article 1.0 Author-Name: Carien van Mourik Author-X-Name-First: Carien Author-X-Name-Last: van Mourik Author-Name: Yuko Katsuo Asami Author-X-Name-First: Yuko Author-X-Name-Last: Katsuo Asami Title: Articulation, Profit or Loss and OCI in the IASB Conceptual Framework: Different Shades of Clean (or Dirty) Surplus Abstract: The 2015 International Accounting Standards Board (IASB) Conceptual Framework Exposure Draft (2015 IASB CF ED) proposes a mixed valuation and transactions approach to income determination. Nevertheless, it does not clearly choose between single or dual concepts of profit, which renders the 2015 IASB CF ED’s financial accounting model somewhat incoherent. The 2015 IASB CF ED proposes a rebuttable presumption that profit or loss should be all-inclusive. Only the IASB can rebut this presumption, but the 2015 IASB CF ED provides no clear conceptual basis on which to rebut this presumption. In spite of considering dual measurement, the IASB believes that it is neither possible, nor necessary, to distinguish between profit or loss and other comprehensive income (OCI) on a conceptual basis. This paper suggests that the 2015 IASB CF ED’s approach to measurement can be improved by introducing a deprival value measurement rule in cases where fair value and historical cost are not appropriate. Furthermore, it argues that under dual measurement it is both necessary and possible to make a conceptual distinction between the realised items of income and expense in profit or loss and those recognised by accretion in OCI. Journal: Accounting in Europe Pages: 167-192 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1448936 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1448936 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:167-192 Template-Type: ReDIF-Article 1.0 Author-Name: Arjan Brouwer Author-X-Name-First: Arjan Author-X-Name-Last: Brouwer Author-Name: Ewout Naarding Author-X-Name-First: Ewout Author-X-Name-Last: Naarding Title: Making Deferred Taxes Relevant Abstract: We analyse the conceptual problems in current accounting for deferred taxes and provide solutions derived from the literature in order to make International Financial Reporting Standards (IFRS) deferred tax numbers value-relevant. In our view, the empirical results concerning the value relevance of deferred taxes should find their way into the accounting standard-setting process. We conclude that deferred taxes should only be recognised for temporary differences that will result in real future tax payments and/or tax receipts. Temporary differences for which the tax cash flow has already occurred have valuation implications for the underlying asset or liability and should, therefore, be accounted for based on the valuation adjustment approach. Furthermore, we conclude that partial allocation should replace comprehensive allocation in order to better align deferred taxes with expected future cash flows and thus increase their relevance and understandability. Finally, we conclude that deferred tax balances should be measured on a discounted basis to address time value. Journal: Accounting in Europe Pages: 200-230 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1451903 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1451903 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:200-230 Template-Type: ReDIF-Article 1.0 Author-Name: Erlend Kvaal Author-X-Name-First: Erlend Author-X-Name-Last: Kvaal Title: Discussion of ‘Making Deferred Taxes Relevant’ Abstract: In this discussion of Brouwer and Naarding's article ‘Making Deferred Taxes Relevant’, which is published in this issue of Accounting in Europe, I question several aspects of their proposal to change the tax accounting standard. I argue that a quest for more value relevance of individual balance sheet items is not a good guideline for accounting standard setting. The distinction between book-first and tax-first temporary differences may be helpful for some analytical purposes, but it is not sufficiently robust to serve as a basis for an accounting standard. However, I agree with the authors that the efforts to improve IAS 12 should not be abandoned. Journal: Accounting in Europe Pages: 231-241 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1473618 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1473618 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:231-241 Template-Type: ReDIF-Article 1.0 Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Author-Name: Alan Teixeira Author-X-Name-First: Alan Author-X-Name-Last: Teixeira Title: Gaps in the IFRS Conceptual Framework Abstract: The stated purpose of the IFRS Conceptual Framework is to assist the IASB to develop Standards that are based on consistent concepts, and also to assist preparers to develop consistent accounting policies when Standards either do not apply or allow a choice of accounting policy. Yet, the Framework actually does surprisingly little to help the IASB (or preparers) determine which assets, liabilities, income and expenses should be recognised, and how they should be measured. The Framework’s focus on assets and liabilities implies that the accounting can, and should, be determined from the balance sheet. Yet, many current financial reporting requirements focus initially on the income statement, and so they are not so much derived from the Framework as instead in need of being reconciled back to it. At its heart, the problem here is that, while the Framework states that accrual accounting provides a better basis for assessing past and future performance than cash-based information, it does not explain why. To do so would require a conceptualisation of how entities’ business models are employed to create value, and of the strengths and limitations of accounting data in enhancing investors’ understanding of that value-creation. The lack of explanation of the purpose and informational objectives of accruals, how they relate to business models and how they cause the income statement and the balance sheet to interact are gaps in the Framework. Filling those gaps would provide a more robust, and natural, way for the IASB to develop recognition and measurement requirements in its Standards. Journal: Accounting in Europe Pages: 153-166 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1476771 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1476771 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:153-166 Template-Type: ReDIF-Article 1.0 Author-Name: Niclas Hellman Author-X-Name-First: Niclas Author-X-Name-Last: Hellman Author-Name: Jordi Carenys Author-X-Name-First: Jordi Author-X-Name-Last: Carenys Author-Name: Soledad Moya Gutierrez Author-X-Name-First: Soledad Author-X-Name-Last: Moya Gutierrez Title: Introducing More IFRS Principles of Disclosure – Will the Poor Disclosers Improve? Abstract: The current paper was prepared for the International Accounting Standards Board (IASB) Research Forum 2017 and evaluates the effects of introducing more principles of disclosure as part of the IASB Disclosure Initiative. We perform a literature review of academic research on how entities have complied with disclosure requirements in the past. The review shows high levels of non-compliance and high volatility across entities, including poor disclosers being far below the average. We find no clear pattern of higher compliance for International Financial Reporting Standards (IFRS) with more reliance on disclosure principles as compared to specific requirements (i.e. IFRS 7, IFRS 8), but note the methodological problem of measuring compliance with disclosure principles. Academic research suggests that the degree of compliance depends on entities’ incentives for providing or withholding information in combination with local conditions for primary users, auditors and regulators. Based on our review, we argue that increased reliance on entities to act in ‘good faith’ when complying with disclosure requirements, in capital-market contexts where entities may be in high-incentive situations and have low costs of non-compliance, is potentially risky in terms of how well the Standards protect primary users from poor disclosers. More emphasis is needed on ensuring that the disclosure requirements are enforceable and auditable in order to secure a certain minimum level of disclosure. Journal: Accounting in Europe Pages: 242-321 Issue: 2 Volume: 15 Year: 2018 Month: 5 X-DOI: 10.1080/17449480.2018.1476772 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1476772 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:2:p:242-321 Template-Type: ReDIF-Article 1.0 Author-Name: José Moreira Author-X-Name-First: José Author-X-Name-Last: Moreira Title: Forging Accounting Principles in Five Countries – A History and Analysis of Trends Journal: Accounting in Europe Pages: 139-142 Issue: 1 Volume: 16 Year: 2019 Month: 1 X-DOI: 10.1080/17449480.2018.1468914 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1468914 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:1:p:139-142 Template-Type: ReDIF-Article 1.0 Author-Name: Malte Klein Author-X-Name-First: Malte Author-X-Name-Last: Klein Author-Name: Rolf Uwe Fülbier Author-X-Name-First: Rolf Uwe Author-X-Name-Last: Fülbier Title: Inside the Black Box of IASB Standard Setting: Evidence from Board Meeting Audio Playbacks on the Amendment of IAS 19 (2011) Abstract: We provide evidence on the little researched internal sphere of private IASB standard setting, more specifically, on the dynamic of board discussions and the respective impact of exogenous input such as comment letters, the array of arguments evoked in IASB debates, individual board member contribution and board-staff relations. We conduct a content analysis of audio recordings of 14 IASB meetings on the amendment of IAS 19 Employee Benefits (2011) between November 2008 and February 2010. Our main findings comprise the argument-based handling of comment letters not being conditioned by the political or economic importance of the senders, the gatekeeper role of staff members in channelling exogenous input and their equal role in board discussions and the dominant reference to conceptual arguments there. We also point to the heterogeneous involvement of board members, their different attribution to key issues and to further observations regarding the meeting governance, board’s discussion culture and etiquette. Our paper adds to the literature on private IASB standard setting, pension accounting and group decision making.Data: All data are available from the public sources identified in this paper Journal: Accounting in Europe Pages: 1-43 Issue: 1 Volume: 16 Year: 2019 Month: 1 X-DOI: 10.1080/17449480.2018.1501502 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1501502 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:1:p:1-43 Template-Type: ReDIF-Article 1.0 Author-Name: Martin Gäumann Author-X-Name-First: Martin Author-X-Name-Last: Gäumann Author-Name: Michael Dobler Author-X-Name-First: Michael Author-X-Name-Last: Dobler Title: Formal Participation in the EFRAG’s Consultation Processes: The Role of European National Standard-Setters Abstract: While the European Financial Reporting Advisory Group (EFRAG) considers European national standard-setters (NSSs) as close partners that play a vital role in its legitimacy, empirical evidence on EFRAG’s consultation processes and the involvement of NSSs therein remains scarce. We use a multi-issue/multi-period approach to investigate the formal participation in EFRAG’s consultation processes. By examining 2,102 comment letters submitted to EFRAG in the 2002–2015 period, we find that NSSs typically outweigh other stakeholder groups in terms of level of participation across stages of the consultation process and project topics. Although NSSs’ level of participation is rather stable over time, it significantly varies across European countries. We also provide a recent classification of European NSSs and show that NSSs’ level of participation varies by their institutional status and is the highest for private NSSs. Our findings have implications for aspects of the legitimacy of both EFRAG and NSSs and shed light on the role of intermediaries in international accounting standard-setting. Journal: Accounting in Europe Pages: 44-81 Issue: 1 Volume: 16 Year: 2019 Month: 1 X-DOI: 10.1080/17449480.2018.1514124 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1514124 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:1:p:44-81 Template-Type: ReDIF-Article 1.0 Author-Name: Jörg-Markus Hitz Author-X-Name-First: Jörg-Markus Author-X-Name-Last: Hitz Author-Name: Henning Schnack Author-X-Name-First: Henning Author-X-Name-Last: Schnack Title: Firm Disclosures about Enforcement Reviews Abstract: This paper provides descriptive evidence on voluntary firm disclosures related to enforcement reviews. Our analyses are set in the German institutional environment, where firms are mandated to disclose error announcements if enforcement institutions, after conclusion of the review, formally establish financial statements to contain material errors. We find that firms provide voluntary disclosures about ongoing enforcement reviews on rare occasions while they opt to disclose information about concluded reviews more frequently. Content analyses reveal that the format of disclosures about ongoing reviews is potentially associated with the eventual review outcome, which is consistent with firms deliberately using these disclosures. This interpretation is supported by additional multivariate analyses of disclosures relating to ongoing reviews, which turn out more likely for contentious reviews. Analysis of market reactions provides weak evidence that investors price these disclosures, as negative market responses to the disclosure of error findings are mitigated. Hence, our paper provides a novel angle on the growing literature on accounting enforcement and yields insights into firm-level incentives for strategic disclosures. Journal: Accounting in Europe Pages: 82-105 Issue: 1 Volume: 16 Year: 2019 Month: 1 X-DOI: 10.1080/17449480.2018.1519320 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1519320 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:1:p:82-105 Template-Type: ReDIF-Article 1.0 Author-Name: Mostafa Harakeh Author-X-Name-First: Mostafa Author-X-Name-Last: Harakeh Author-Name: Edward Lee Author-X-Name-First: Edward Author-X-Name-Last: Lee Author-Name: Martin Walker Author-X-Name-First: Martin Author-X-Name-Last: Walker Title: The Differential Impact of IFRS Adoption on Aspects of Seasoned Equity Offerings in the UK and France Abstract: We examine the potential for IFRS to influence the market for SEOs in the UK and France. The divergence between the UK domestic accounting standards and IFRS is minor (low-divergence firms) whereas domestic accounting standards in France differ materially from IFRS (high-divergence firms); however, both countries have similar legal enforcement and institutional settings that might confound the effect of IFRS adoption. We argue that IFRS adoption serves to mitigate information asymmetry and improve accounting quality. Accordingly, we find that, following IFRS adoption, earnings management activities decrease among high-divergence firms prior to issuing SEOs. As a result of the lower levels of earnings management and information asymmetry, we predict and find that the market reaction to issuing SEOs improves significantly for high-divergence firms following IFRS. Given that equity financing becomes less costly, we find that the propensity to issue new SEOs increases among high-divergence firms after IFRS adoption. We find no similar changes among low-divergence firms. The results persist after running a matched-sample analysis and controlling for potential self-selection bias. Journal: Accounting in Europe Pages: 106-138 Issue: 1 Volume: 16 Year: 2019 Month: 1 X-DOI: 10.1080/17449480.2018.1531141 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1531141 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:1:p:106-138 Template-Type: ReDIF-Article 1.0 Author-Name: Martin Schmidt Author-X-Name-First: Martin Author-X-Name-Last: Schmidt Title: A Note on the Proprietary and Entity Perspectives in Financial Statements: The Implications for two Current Controversial Issues Abstract: Financial statements can portray the financial position and performance of an entity from different perspectives. Two dominant perspectives are the proprietary and entity perspectives. These perspectives also feature in recent discussions by the IASB and the FASB in relation to their conceptual framework project. The adopted perspective will yield different presentations for a number of issues. This paper illustrates the implications for two controversial issues currently under discussion by the IASB and the FASB: accounting for changes in a reporting entity’s own credit risk when liabilities are measured at fair value, and the classification of certain obligations as either equity or liabilities. The paper explains why the adoption and consistent application of one perspective are important for standard setting and financial reporting to ensure the consistent presentation of an entity’s performance and financial position that can be correctly interpreted by users of financial statements against the background of the chosen perspective. Journal: Accounting in Europe Pages: 134-147 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1430368 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1430368 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:134-147 Template-Type: ReDIF-Article 1.0 Author-Name: Elina Haapamäki Author-X-Name-First: Elina Author-X-Name-Last: Haapamäki Title: Voluntary Auditing: A Synthesis of the Literature Abstract: Voluntary auditing has received increased attention from researchers in recent decades. Empirical studies that have examined demand for voluntary audits have suggested that regulatory intervention may not always be necessary, though some argue that regulators protect society from market failure by demanding statutory audits [Barton, J., & Waymire, G. (2004). Investor protection under unregulated financial reporting. Journal of Accounting and Economics, 38, 65–116]. To date, there has been no review of the literature on determinants of voluntary audits. I provide a research framework to categorize the attributes that affect demand for voluntary audits and identify areas that need further examination. While the given compact body of literature has served different purposes, two major reasons for voluntary auditing are apparent: the importance of audited financial statements to lenders and the intention to further deregulate audits for smaller companies to relieve cost burdens. However, I contribute to the auditing literature by identifying the main attributes associated with the demand for voluntary audit. In doing so, I develop a framework consisting of firm attributes, separation of ownership and control attributes, agency relationship attributes, management attributes, and signalling attributes. Journal: Accounting in Europe Pages: 81-104 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1430369 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1430369 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:81-104 Template-Type: ReDIF-Article 1.0 Author-Name: Lasse Niemi Author-X-Name-First: Lasse Author-X-Name-Last: Niemi Author-Name: W. Robert Knechel Author-X-Name-First: W. Robert Author-X-Name-Last: Knechel Author-Name: Hannu Ojala Author-X-Name-First: Hannu Author-X-Name-Last: Ojala Author-Name: Jill Collis Author-X-Name-First: Jill Author-X-Name-Last: Collis Title: Responsiveness of Auditors to the Audit Risk Standards: Unique Evidence from Big 4 Audit Firms Abstract: We examine the effect of changes in audit risk standards on the conduct of financial statement audits in a European setting. We investigate this by analysing the audit hours and audit fees for clients of Big 4 audit firms in Finland in 1996 and 2010. Our results show that audit firms became more sensitive to clients’ business risk due to the introduction of the new audit risk standards, with more audit hours allocated to owner-managed companies in 2010 than in 1996, and fewer audit hours allocated to low-risk clients in 2010 than in 1996. Also, the labour mix in the audit team changed for owner-managed companies, with a greater work load carried by junior auditors in 2010 than in 1996. Regarding the price of audit, we find an increase in audit fees for clients with high business risk, while audit fees remained at roughly the same level for low-risk clients. These findings should be of interest to the auditing profession and those involved in the development of auditing regulations. Journal: Accounting in Europe Pages: 33-54 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1431398 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1431398 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:33-54 Template-Type: ReDIF-Article 1.0 Author-Name: José Morales-Díaz Author-X-Name-First: José Author-X-Name-Last: Morales-Díaz Author-Name: Constancio Zamora-Ramírez Author-X-Name-First: Constancio Author-X-Name-Last: Zamora-Ramírez Title: The Impact of IFRS 16 on Key Financial Ratios: A New Methodological Approach Abstract: In January 2016, the International Accounting Standards Board issued a new standard for lease accounting: International Financial Reporting Starndard (IFRS) 16. IFRS 16 will lead to the capitalisation of the majority of current operating leases by lessees. We analyse the impact of the new accounting model on entity’s key financial, contributing to research by making significant changes in the Imhoff et al. [(1991). Operating leases: Impact of constructive capitalization. Accounting Horizons, 5(1), 51–63. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=9604010111&site=ehost-live; (1997). Operating leases: Income effects of constructive capitalization. Accounting Horizons, 11(2), 12–32. Retrieved from http://0-search.proquest.com.fama.us.es/docview/208896121?accountid=14744] methodology used by previous authors. We change how the lease term is estimated (more aligned with the final approved standard), and how the discount rate is obtained. Furthermore, we use a more comprehensive sample (646 quoted European companies). In line with previous research we find important systematic impacts on key balance sheet financial ratios (mainly leverage ratios), on a magnitude that depends on the operating lease intensity of the sector in which the entity operates. Our estimated impact is generally higher than that obtained in previous studies. The most affected sectors are retail, hotels and transportation. We do not find a consistent result with regard to the effect on profitability ratios. Journal: Accounting in Europe Pages: 105-133 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1433307 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1433307 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:105-133 Template-Type: ReDIF-Article 1.0 Author-Name: Carien Van Mourik Author-X-Name-First: Carien Author-X-Name-Last: Van Mourik Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: The European IFRS Endorsement Process – in Search of a Single Voice Abstract: We analyse the creation and development of the European Financial Reporting Advisory Group (EFRAG), a key part of the EU endorsement mechanism for International Financial Reporting Standards (IFRS), which was probably the first example of a dedicated IFRS endorsement system. We discuss the historical background to the EU approach and we analyse how EFRAG evolved over its early years up to the Maystadt reform. Our analysis addresses its remit, its operational structure and financing and the key decisions made in the endorsement process over this period. We find that while national standard-setters had a limited role in the early stages, and EFRAG had limited resources, over time the pressure to find more resources and to try to achieve a unified voice in the creating of international standards have resulted in national standard-setters playing an ever-greater role. Nonetheless, a single voice for Europe is not likely to be attained Journal: Accounting in Europe Pages: 1-32 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1438635 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1438635 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:1-32 Template-Type: ReDIF-Article 1.0 Author-Name: Marcel Haak Author-X-Name-First: Marcel Author-X-Name-Last: Haak Author-Name: Michelle Muraz Author-X-Name-First: Michelle Author-X-Name-Last: Muraz Author-Name: Roland Zieseniß Author-X-Name-First: Roland Author-X-Name-Last: Zieseniß Title: Joint Audits: Does the Allocation of Audit Work Affect Audit Quality and Audit Fees? Abstract: Audit quality and cost consequences of joint audits have been continually discussed, especially since the publication of the European Commission’s Green Paper in 2010. We provide new empirical evidence for the French audit market. We show that a more balanced audit work allocation between the engaged audit firms reduces the audit quality and enhances the audit fees as compared to an unbalanced work allocation. We measure the quality effects following the concept of abnormal accruals and the concept of cosmetic earnings management. As unbalanced joint audits have parallels to single audits, our results have interest to those debating the benefits and costs of joint audits as compared to single audits. Journal: Accounting in Europe Pages: 55-80 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1440611 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1440611 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:55-80 Template-Type: ReDIF-Article 1.0 Author-Name: Franck Missonier-Piera Author-X-Name-First: Franck Author-X-Name-Last: Missonier-Piera Title: Brand Valuation Journal: Accounting in Europe Pages: 148-149 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1440612 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1440612 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:148-149 Template-Type: ReDIF-Article 1.0 Author-Name: Massimo Sargiacomo Author-X-Name-First: Massimo Author-X-Name-Last: Sargiacomo Title: The Routledge Companion to Qualitative Accounting Research Methods Journal: Accounting in Europe Pages: 149-151 Issue: 1 Volume: 15 Year: 2018 Month: 1 X-DOI: 10.1080/17449480.2018.1442581 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1442581 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:1:p:149-151 Template-Type: ReDIF-Article 1.0 Author-Name: Susana Jorge Author-X-Name-First: Susana Author-X-Name-Last: Jorge Author-Name: Josette Caruana Author-X-Name-First: Josette Author-X-Name-Last: Caruana Author-Name: Eugenio Caperchione Author-X-Name-First: Eugenio Author-X-Name-Last: Caperchione Title: ‘The Challenging Task of Developing European Public Sector Accounting Standards’ Journal: Accounting in Europe Pages: 143-145 Issue: 2 Volume: 16 Year: 2019 Month: 5 X-DOI: 10.1080/17449480.2019.1637530 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1637530 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:2:p:143-145 Template-Type: ReDIF-Article 1.0 Author-Name: Josette Caruana Author-X-Name-First: Josette Author-X-Name-Last: Caruana Author-Name: Giovanna Dabbicco Author-X-Name-First: Giovanna Author-X-Name-Last: Dabbicco Author-Name: Susana Jorge Author-X-Name-First: Susana Author-X-Name-Last: Jorge Author-Name: Maria Antónia Jesus Author-X-Name-First: Maria Antónia Author-X-Name-Last: Jesus Title: The Development of EPSAS: Contributions from the Literature Abstract: EPSAS are being considered in the EU context where a need for harmonisation in Governmental Accounting (GA) has been recognised as important to increase the reliability of sources of information to the National Accounts (NA) figures. However, GA and NA are two different and parallel reporting systems at national level, even if, within the European context, EPSAS intend to contribute for their convergence. The relationship between GA and NA has been recurrently addressed in the literature over the last two decades, with professionals being more proactive while academics have been more reactive in the debate. Several issues have been raised. This paper recaptures and revises these issues, synthesising academic and practitioner literature, archival documents and reports of EU working groups, from 1996 to 2018. The analysis highlights the more controversial areas, and those that seemed already settled but yet are now, within the context of EPSAS development, being raised again. Specifically, the paper calls attention to (1) the need to manage between two different conceptual frameworks of GA and NA; (2) the importance of interdisciplinary collaboration between the professionals involved, namely accountants, public administrators and statisticians; (3) the role of budgetary accounting and the alignment required between reporting in GA and NA, reducing and harmonising adjustments to be made when translating data from one into the other; and (4) the need to address auditing issues, as EPSAS on their own may not be enough to ensure reliability of the information reported. Journal: Accounting in Europe Pages: 146-176 Issue: 2 Volume: 16 Year: 2019 Month: 5 X-DOI: 10.1080/17449480.2019.1624924 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1624924 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:2:p:146-176 Template-Type: ReDIF-Article 1.0 Author-Name: Linda A. Kidwell Author-X-Name-First: Linda A. Author-X-Name-Last: Kidwell Author-Name: Suzanne Lowensohn Author-X-Name-First: Suzanne Author-X-Name-Last: Lowensohn Title: Participation in the Process of Setting Public Sector Accounting Standards: the Case of IPSASB Abstract: Accounting standard-setting bodies employ mechanisms for stakeholder participation in the standard-setting process. While due process procedures of national and international accounting standards boards have been studied in various contexts, the International Public Sector Accounting Standards Board (IPSASB) is a unique organisational body warranting study at a fundamental level. IPSASB has celebrated 20 years of standard setting; however, as a transnational standard setter, the IPSASB lacks determinate authoritative status, and adoption of its standards is quite varied. Given such circumstances, what stakeholders participate in IPSASB’s due process procedures, and in what manner? This paper identifies the stakeholder type, the tone of response, and the geographical origin of respondents submitting comment letters to IPSASB due process documents. Although in principle the effort to develop European Public Sector Accounting Standards (EPSAS) is independent of International Public Sector Accounting Standards (IPSAS), IPSAS have been cited as ‘an indisputable reference’ for the development of EPSAS; thus stakeholder participation in the setting of IPSAS is also relevant to those interested in developing EPSAS. Journal: Accounting in Europe Pages: 177-194 Issue: 2 Volume: 16 Year: 2019 Month: 5 X-DOI: 10.1080/17449480.2019.1632466 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1632466 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:2:p:177-194 Template-Type: ReDIF-Article 1.0 Author-Name: Bianca Mann Author-X-Name-First: Bianca Author-X-Name-Last: Mann Author-Name: Peter C. Lorson Author-X-Name-First: Peter C. Author-X-Name-Last: Lorson Author-Name: Lasse Oulasvirta Author-X-Name-First: Lasse Author-X-Name-Last: Oulasvirta Author-Name: Ellen Haustein Author-X-Name-First: Ellen Author-X-Name-Last: Haustein Title: The Quest for a Primary EPSAS Purpose – Insights from Literature and Conceptual Frameworks Abstract: Since 2013, the European Union has aimed to harmonize the public sector accounting (PSA) of its member states by developing European Public Sector Accounting Standards (EPSAS). As a prerequisite for consistent EPSAS, a conceptual framework (CF) is to be developed which includes an explicit selection of purposes. Providing an international comparative view with the theoretical underpinning of Nobes’ classification, this paper presents a literature-based systematization of PSA purposes. Our systematization is applied to three CFs: one international (IPSAS) and two national (from the USA and Germany, respectively). Through a normative discussion, we conclude that accountability is preferable as the overall accounting purpose. This theoretical lens is used to evaluate the recent status quo of the ongoing EPSAS CF project. This paper thereby develops relevant implications for accounting theory and offers a starting point for standard setters and scholars to prioritize purposes for PSA with respect to different legal frameworks. Journal: Accounting in Europe Pages: 195-218 Issue: 2 Volume: 16 Year: 2019 Month: 5 X-DOI: 10.1080/17449480.2019.1632467 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1632467 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:2:p:195-218 Template-Type: ReDIF-Article 1.0 Author-Name: Marco Bisogno Author-X-Name-First: Marco Author-X-Name-Last: Bisogno Author-Name: Caroline Aggestam Pontoppidan Author-X-Name-First: Caroline Author-X-Name-Last: Aggestam Pontoppidan Author-Name: Ron Hodges Author-X-Name-First: Ron Author-X-Name-Last: Hodges Author-Name: Francesca Manes-Rossi Author-X-Name-First: Francesca Author-X-Name-Last: Manes-Rossi Title: Setting International Public-Sector Accounting Standards: Does ‘Public’ Matter? The Case of Revenue from Non-Exchange Transactions Abstract: This paper investigates accounting for non-exchange revenue, an issue which has a strong relevance in public sector accounting, but which is rarely encountered in the private sector. The IPSASB consultation paper ‘Accounting for Revenue and Non-exchange Expenses’ is analyzed to illustrate that the specificities of the public sector are not necessarily taken into account when developing public sector accounting standards. Our analysis is informed by literature on the political nature of accrual accounting in public sector entities. The paper highlights the territorializing role of the IPSASB, the mediating role attributable to the consultation paper, and the potential adjudicating and subjectivizing roles of a future public sector accounting standard on revenue recognition. Journal: Accounting in Europe Pages: 219-235 Issue: 2 Volume: 16 Year: 2019 Month: 5 X-DOI: 10.1080/17449480.2019.1624791 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1624791 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:2:p:219-235 Template-Type: ReDIF-Article 1.0 Author-Name: Frank Thinggaard Author-X-Name-First: Frank Author-X-Name-Last: Thinggaard Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Denmark Abstract: I analyse the influence of IFRS on the Danish accounting regulation based on the EU Accounting Directive. In Denmark, the EU Accounting Directive is brought into force through the Danish Financial Statements Act. The analysis shows that the provisions in the Act are aligned with the IFRS to a great extent. It also shows that the Danish legislators extensively refer to IFRS and that they consider the IFRS to be the source to use for completing the national rules. I additionally show that the enforcers of the Danish Financial Statements Act look to the IFRS for guidance when they interpret the provisions, and that many important stakeholders have a positive attitude towards the use of IFRS for non-listed companies. The conclusion is that IFRS standards play a decisive role and have strong legitimacy in Denmark. Journal: Accounting in Europe Pages: 67-79 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1298136 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1298136 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:67-79 Template-Type: ReDIF-Article 1.0 Author-Name: Anne Le Manh Author-X-Name-First: Anne Author-X-Name-Last: Le Manh Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from France Abstract: In France, the European accounting directive has been implemented via a decree and a ministerial order, issued without any public consultation and which led to an amendment of the Commercial Code and three regulations released by the Autorité des normes comptables, the French standard-setter. Our analysis of those texts reveals that none of them refer to International Financial Reporting Standards (IFRS). We did not find evidence of any reference to IFRS from the Autorité des marches financiers, the French market regulator, in its decisions on the right application of French Generally Accepted Accounting Principles by listed companies. Hence, IFRS seem to have played a minor role in the recent modification of French regulations resulting from the implementation of the European accounting directive. Journal: Accounting in Europe Pages: 94-101 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1298137 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1298137 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:94-101 Template-Type: ReDIF-Article 1.0 Author-Name: Lehte Alver Author-X-Name-First: Lehte Author-X-Name-Last: Alver Author-Name: Jaan Alver Author-X-Name-First: Jaan Author-X-Name-Last: Alver Title: The Role and Current Status of IFRS in the Completion of the National Accounting Rules – Evidence from Estonia Abstract: The main purpose of this paper is to provide an overview of International Financial Reporting Standards (IFRS) application in Estonia. After restoration of independence, development of the Accounting and Financial Reporting System in Estonia has been based on internationally accepted accounting principles where IFRS and EU Directives have had an important role. From 2003 to 2013, the system based on the Full IFRS and after that, the switch from the Full IFRS to the IFRS for Small and Medium-sized Entities (SMEs) took place. Estonian position on IFRSs is very positive. IFRSs were heavily used in the system of setting local guidelines and despite switching to the IFRS for SMEs as base for the local guidelines, they are still used as a very important reference point and source of interpretation for national accounting rules based on the EU Accounting Directive. Journal: Accounting in Europe Pages: 80-87 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1298138 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1298138 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:80-87 Template-Type: ReDIF-Article 1.0 Author-Name: Rolf Uwe Fülbier Author-X-Name-First: Rolf Uwe Author-X-Name-Last: Fülbier Author-Name: Christoph Pelger Author-X-Name-First: Christoph Author-X-Name-Last: Pelger Author-Name: Evamaria Kuntner Author-X-Name-First: Evamaria Author-X-Name-Last: Kuntner Author-Name: Marcus Bravidor Author-X-Name-First: Marcus Author-X-Name-Last: Bravidor Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Austria and Germany Abstract: Austria and Germany share similar accounting traditions. International harmonization in both countries has mainly focused on group accounting. In contrast, single financial statements give rise to legal and tax consequences and, thus, are still tied to the traditional principles of orderly accounting. Recent regulatory changes confirmed this dual role of accounting in both countries, while moving local accounting rules closer to IFRS, although to different extents. We illustrate how recent regulations in the two countries made reference to IFRS, how IFRS was considered during the law-making process and outline major differences that remain between domestic and international accounting standards. Journal: Accounting in Europe Pages: 13-28 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1298139 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1298139 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:13-28 Template-Type: ReDIF-Article 1.0 Author-Name: Ioannis Tsalavoutas Author-X-Name-First: Ioannis Author-X-Name-Last: Tsalavoutas Title: The Role and Current Status of IFRS in the Completion of National Rules – Evidence from Greece Abstract: Law 4308/2014 is the main regulation that transposed Accounting Directive 2013/34 of the EU into national law in Greece. This short paper summarises the underlying background and the process followed up to the issuance of this Law. It also outlines the key accounting principles introduced with this Law and how they compare with IFRS. This brief analysis indicates that, to a large extent, Greek accounting standards have now been aligned with IFRS. Given the preceding substantial differences between Greek accounting Laws and IFRS, this Law introduced significant changes to the accounting environment for non-listed companies in Greece, aiming at improving accounting quality and enhancing accounting comparability between listed and non-listed companies. Journal: Accounting in Europe Pages: 102-112 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1298140 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1298140 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:102-112 Template-Type: ReDIF-Article 1.0 Author-Name: Irene Karamanou Author-X-Name-First: Irene Author-X-Name-Last: Karamanou Author-Name: Anastasia Kopita Author-X-Name-First: Anastasia Author-X-Name-Last: Kopita Author-Name: Lina Lemessiou Author-X-Name-First: Lina Author-X-Name-Last: Lemessiou Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence on Cyprus Abstract: The case of Cyprus with respect to the adoption of International Financial Reporting Standards (IFRS) is unique given the country’s strong reliance on international business and accounting-related services. As such, Cyprus has required the use of IFRS since 1981 not only for publicly listed firms but also for private companies regardless of their size. Cyprus’ reluctance to fully transpose Directive 2013/34/EU into national law cannot be unrelated to its long-standing requirement of financial statements that are not only prepared under IFRS but are also audited for all types of corporations registered in the Republic. We conclude that transposing the new Accounting Directive in its entirety into national law could have adverse effects on the Government tax revenue, the GDP of the services sector and the credibility of Cyprus as an international business and financial services center. Journal: Accounting in Europe Pages: 49-55 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1299935 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1299935 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:49-55 Template-Type: ReDIF-Article 1.0 Author-Name: Jill Collis Author-X-Name-First: Jill Author-X-Name-Last: Collis Author-Name: Robin Jarvis Author-X-Name-First: Robin Author-X-Name-Last: Jarvis Author-Name: Len Skerratt Author-X-Name-First: Len Author-X-Name-Last: Skerratt Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from the UK Abstract: Drawing on secondary data, we examine the transposition of the Accounting Directive 2013 into UK GAAP with a specific focus on references to IFRS. The process involved consultation and regulatory impact assessment on the options in the Accounting Directive and proposed changes to accounting standards for non-publicly accountable entities. This led to an IFRS-based approach from 2016 with three tiers: EU-adopted IFRS for group listed companies and other publicly accountable entities, an adaptation of IFRS for SMEs for non-publicly accountable entities, and a simplified version for micro-entities incorporating the requirements of the Accounting Directive. This outcome is not surprising since the UK was one of the founding members of the original International Accounting Standards Committee and a strong proponent of little GAAP. Indeed, the UK’s former Financial Reporting Standard for Smaller Entities provided a model for the IFRS for SMEs. In the past, there were few references to IFRS by the UK’s enforcement and interpretation bodies. Today, guidance is taken from IFRS Interpretations Committee. We contribute to the literature by describing the main processes involved in implementing the Accounting Directive and the move to an IFRS-based approach in UK GAAP. Our analysis should be of interest to researchers and policymakers alike. Journal: Accounting in Europe Pages: 235-247 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1300673 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1300673 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:235-247 Template-Type: ReDIF-Article 1.0 Author-Name: Arjan Brouwer Author-X-Name-First: Arjan Author-X-Name-Last: Brouwer Author-Name: Martin Hoogendoorn Author-X-Name-First: Martin Author-X-Name-Last: Hoogendoorn Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from the Netherlands Abstract: Dutch law (B2T9) is positive towards IFRS. IFRS may be used by all entities, there is a specific option for entities using IFRS in the consolidated financial statements to apply an IFRS-friendly version of B2T9 in its separate financial statements, and IFRS for SMEs can be used by non-listed and non-regulated companies in combination with B2T9. In the process of adoption of the 2013 EU Accounting Directive only limited references have been made to IFRS. This is not an indication of a reduced interest in IFRS, but is a result of limiting the changes of B2T9 to those that are necessary as a result of changes at the EU level. The Dutch Accounting Standards Board, issuing Dutch Accounting Standards (DAS), considers IFRS when developing and changing its standards. In addition to the IFRS option DAS often include one or more additional optional treatments that are considered suitable for non-listed companies. The Dutch regulatory authority AFM is also positive towards IFRS and even advocates elimination of non-IFRS options from Dutch GAAP as much as possible. The number of major differences between Dutch GAAP and IFRS is relatively limited, with only a few differences that cannot be avoided by an entity when preparing financial statements under Dutch GAAP. Journal: Accounting in Europe Pages: 137-149 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1300674 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1300674 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:137-149 Template-Type: ReDIF-Article 1.0 Author-Name: Aleš Novak Author-X-Name-First: Aleš Author-X-Name-Last: Novak Author-Name: Aljoša Valentinčič Author-X-Name-First: Aljoša Author-X-Name-Last: Valentinčič Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Slovenia Abstract: We provide an overview of the role and current status of International Financial Reporting Standards (IFRS) in the development of national accounting rules in Slovenia. The basic requirements of the financial reporting in Slovenia are set in the Companies Act, while the Slovenian accounting standards (SAS) provide a detailed authoritative guidance, especially on measurement. We describe the (historical) relations of all four editions of SAS with IFRS, provide explanations for the close alignment of SAS 2006 and SAS 2016 with IFRS, and identify major differences. In addition, the paper covers the adoption of the new EU accounting Directive into Slovenian legislation. Journal: Accounting in Europe Pages: 187-198 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1300675 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1300675 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:187-198 Template-Type: ReDIF-Article 1.0 Author-Name: Ann Jorissen Author-X-Name-First: Ann Author-X-Name-Last: Jorissen Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Belgium Abstract: We study the incorporation of EU Directive 2013/34/EU on financial reporting into Belgian legislation. By analyzing the forces that shape the transposition of this Directive, we examine opportunities and obstacles in the Belgian institutional environment that hinder or stimulate the possibilities for the International Financial Reporting Standards (IFRS) to influence financial reporting by private firms in Belgium. As a result of several national forces, the Belgian legislature did not use all opportunities available to modernize financial reporting for private entities when transposing this Directive. We further discuss existing differences between Belgian National Accounting Rules for private enterprises and the IFRS and observe that the influence of the latter on financial reporting regulation for private enterprises in Belgium remains rather limited. Journal: Accounting in Europe Pages: 29-39 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1300676 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1300676 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:29-39 Template-Type: ReDIF-Article 1.0 Author-Name: Cătălin Nicolae Albu Author-X-Name-First: Cătălin Nicolae Author-X-Name-Last: Albu Author-Name: Nadia Albu Author-X-Name-First: Nadia Author-X-Name-Last: Albu Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Romania Abstract: Romanian accounting rules (RAR) had followed a convergence process with International Accounting Standards/International Financial Reporting Standards (IAS/IFRS) since 1999, and the level of convergence has increased over time. The Romanian accounting regulator continues to follow IAS/IFRS in internalizing the Accounting Directive 2013/34/EU. Only a few major differences still exist (some of them due the restrictions in the Accounting Directive 2013/34/EU) between RAR and IFRS. However, RAR lack the level of detail existing in IFRS, and IFRS cannot be used in practice as a source of guidance and interpretation. While major stakeholders have a positive attitude towards the convergence with IAS/IFRS, the Romanian accounting regulator intends to keep the control over RAR and avoid differences in interpretations that might have tax consequences. Despite the good level of convergence of RAR with IFRS, practitioners tend to continue to utilize the tax approach as a source of guidance and interpretation. Journal: Accounting in Europe Pages: 177-186 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301668 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301668 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:177-186 Template-Type: ReDIF-Article 1.0 Author-Name: Helena Isidro Author-X-Name-First: Helena Author-X-Name-Last: Isidro Author-Name: Cláudio Pais Author-X-Name-First: Cláudio Author-X-Name-Last: Pais Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Portugal Abstract: We explain the process and documents that internalise the European Union (EU) Directive No. 2013/34 in Portugal. The Portuguese accounting standard setting body, the Comissão de Normalização Contabilística (CNC), is the entity in charge of the preparation and implementation of accounting standards. As such, CNC was responsible for the implementation of the EU Directive in Portugal. The Directive was approved by Decree-Law No. 98/2015 of 2 June 2015, but many important aspects of the Directive had already been adopted in Portugal when a new accounting system, designated Sistema de Normalização Contabilística (SNC), was introduced in 2009. Decree-Law No. 98/2015 of 2 June 2015 amends the SNC system to incorporate news aspects of the 2013 EU Directive. The current accounting rules in Portugal are strongly aligned with IFRS but some differences exist. Journal: Accounting in Europe Pages: 164-176 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301669 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301669 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:164-176 Template-Type: ReDIF-Article 1.0 Author-Name: Monique Micallef Author-X-Name-First: Monique Author-X-Name-Last: Micallef Title: Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Malta Abstract: We analyse the extent to which International Financial Reporting Standards (IFRS) have influenced the development of the national generally accepted accounting principles (GAAP) in the transposition of Directive 2013/34/EU in Malta including whether they are used as a reference point in the interpretation of the national GAAP. Malta mandated the use of IFRS by all companies for a significant number of years. This has resulted in IFRS influencing the development of the national GAAP; and enforcers and other key stakeholders viewing IFRS positively. Journal: Accounting in Europe Pages: 131-136 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301670 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301670 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:131-136 Template-Type: ReDIF-Article 1.0 Author-Name: Irena Jindrichovska Author-X-Name-First: Irena Author-X-Name-Last: Jindrichovska Author-Name: Dana Kubickova Author-X-Name-First: Dana Author-X-Name-Last: Kubickova Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from the Czech Republic Abstract: The aim of this paper is to characterize the extent to which International Financial Reporting Standards (IFRS) is used as a reference point for national accounting rules in the Czech Republic (CR) and what elements are incorporated in Czech Accounting Regulation, paying particular attention to the latest amendment to the Accounting Act (AA) based on the EU accounting Directive (2013/34/EU). Methods used include analysis of Ministry of Finance documents, interviews with the team members who participated in the new wording of the AA to adapt it to the EU Directive and comparison of current to existing IFRS reporting rules. The results confirm that IFRS implementation in the CR is determined by economic and institutional factors, a major part of which is played by foreign ownership of dominant Czech companies and their subordinate position as subsidiaries of foreign entities and the weak capital market. Implementation of elements of IFRS into Czech accounting standards is still only partial. This process takes place as an integral part of the process of reorientation of the entire economic system toward market principles, which includes the accounting system. Each change of the AA involves some elements of IFRS; however, between the two systems, there are still significant differences, the roots of which lie in a different (continental) model of accounting. Journal: Accounting in Europe Pages: 56-66 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301671 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301671 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:56-66 Template-Type: ReDIF-Article 1.0 Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Sweden Abstract: In this paper, the influence of IFRS on Swedish national accounting rules is analyzed. The lawmaker’s and standard setters’ response to EU Accounting Directive 2013/34/EU is studied, as well as the use of IFRS in enforcement. The conclusion is that IFRS have a strong position and legitimacy in Swedish financial reporting. Journal: Accounting in Europe Pages: 207-216 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301672 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301672 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:207-216 Template-Type: ReDIF-Article 1.0 Author-Name: Collette E. Kirwan Author-X-Name-First: Collette E. Author-X-Name-Last: Kirwan Author-Name: Aileen Pierce Author-X-Name-First: Aileen Author-X-Name-Last: Pierce Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Ireland Abstract: We examine the extent to which International Financial Reporting Standards (IFRSs) are used as a reference point and as a basis for the development of accounting standards in the Republic of Ireland (ROI). In particular, the focus is on accounting standards applicable to entities other than those listed on a regulated EU market. The objective is to provide a deeper understanding of the direct and indirect effect of IFRS on accounting standards applicable predominantly to private companies limited by shares in ROI. We illustrate how the historical links between the UK and ROI continue to influence accounting standards applicable in ROI. The enactment of the Companies (Accounting) Bill 2016 into ROI law will maintain the traditional alignment of UK and ROI accounting regulation, whilst simultaneously bringing into force the remaining aspects of the EU Accounting Directive 2013/34/EU, not currently applicable in ROI. Journal: Accounting in Europe Pages: 113-120 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1301673 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1301673 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:113-120 Template-Type: ReDIF-Article 1.0 Author-Name: Roberto Di Pietra Author-X-Name-First: Roberto Author-X-Name-Last: Di Pietra Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Italy Abstract: We examine the recent changes that have affected the Italian accounting scenario after the adoption of the IFRS and the enactment of the European accounting system. In particular, we have focused our attention on the decision of the legislature to enlarge the mandatory adoption of IFRS to non-listed companies and to individual financial statements (FS). At the same time, we have observed the changes determined by the EU Directive 2013/34 on the Italian Civil Code and the FS legislation. Both set of changes are describing a process under which the Italian accounting rules are moving towards the international accounting standards and their framework, contents and methods. Therefore, the main differences among national rules and IFRS are grounded on the measurement rules and the role played by the historical cost principles and the strict and detailed regulation of the Balance sheet and Income statement formats. Journal: Accounting in Europe Pages: 121-130 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1302593 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1302593 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:121-130 Template-Type: ReDIF-Article 1.0 Author-Name: Bernard Raffournier Author-X-Name-First: Bernard Author-X-Name-Last: Raffournier Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Switzerland Abstract: Although Switzerland is not a member of the European Union, the EU directives have largely influenced the Swiss accounting regulation. IFRS also have been highly influential since many large companies used them long before they became mandatory for listed firms. Moreover, IFRS served as a benchmark for the development of Swiss GAAP. This article compares the current Swiss accounting regulation to the new EU accounting directive and to IFRS. Despite many similarities, the Swiss regulation retains major specificities, the most notable being the permission of hidden reserves. Journal: Accounting in Europe Pages: 217-225 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1302594 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1302594 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:217-225 Template-Type: ReDIF-Article 1.0 Author-Name: Slavko Šodan Author-X-Name-First: Slavko Author-X-Name-Last: Šodan Author-Name: Željana Aljinović Barać Author-X-Name-First: Željana Author-X-Name-Last: Aljinović Barać Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Croatia Abstract: We examine the changes in Croatian accounting regulation, in the context of 2013/34/EU Directive implementation and analyse indirect effects of IFRS on national reporting regulation for non-listed companies. The main goal is to determine the level of conformity between Croatian accounting rules and IFRS as adopted by EU. Analysis shows that IFRS are used in the great extent as a source for provisions in Croatian Financial Reporting Standards (CFRS). There are only a few major differences between Croatian financial reporting standards and IFRS. However, there are a number of IFRS standards that are considered not to be relevant in the context of CFRS, as CFRS are intended to be used only by SMEs. Nevertheless, the management is permitted to use provisions and guidance from IFRS, if CFRS provisions are not applicable to a certain transaction or event. Journal: Accounting in Europe Pages: 40-48 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1302595 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1302595 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:40-48 Template-Type: ReDIF-Article 1.0 Author-Name: Karol Marek Klimczak Author-X-Name-First: Karol Marek Author-X-Name-Last: Klimczak Author-Name: Joanna Krasodomska Author-X-Name-First: Joanna Author-X-Name-Last: Krasodomska Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Poland Abstract: We outline the process of implementation of the accounting Directive 2013/34/EU by the Republic of Poland in the context of references to IFRS. The purpose of the article is to determine to what extent IFRS are used by actors taking part in the legislative and enforcement processes. The accounting regulation in Poland comprises an act of Parliament and the regulations of the Ministry of Finance. As a result the regulation is relatively succinct and many elements present in IFRS are not covered, while the issues of record-keeping and verification of accounting documentation receive more attention. A review of the responses to a call for opinions reveals that IFRS are rarely mentioned. Journal: Accounting in Europe Pages: 158-163 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1302596 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1302596 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:158-163 Template-Type: ReDIF-Article 1.0 Author-Name: Henry Jarva Author-X-Name-First: Henry Author-X-Name-Last: Jarva Author-Name: Hanna Silvola Author-X-Name-First: Hanna Author-X-Name-Last: Silvola Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Finland Abstract: We investigate how Finland has applied Directive 2013/34/EU of the European Parliament and of the Council to the annual financial statements, consolidated financial statements and related reports of certain types of undertakings. In addition to the implementation process and general implications of the Finnish Accounting Act, we emphasize its implications and interplay with IFRS. We conclude that the national implementation of Directive 2013/34/EU successfully diminished the administrative burden experienced by small companies. Journal: Accounting in Europe Pages: 88-93 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1302597 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1302597 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:88-93 Template-Type: ReDIF-Article 1.0 Author-Name: Erlend Kvaal Author-X-Name-First: Erlend Author-X-Name-Last: Kvaal Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Norway Abstract: Although not a EU member, Norway is required to implement the EU Accounting Directive through its obligations under the EEA agreement. An expert group has prepared a draft law that will be decided upon by the legislator, most likely during 2017. The draft law has a strong orientation towards IFRS, which is evidenced in particular by the choice of IFRS for SMEs as the basis for Norwegian accounting standards. Journal: Accounting in Europe Pages: 150-157 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1304646 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1304646 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:150-157 Template-Type: ReDIF-Article 1.0 Author-Name: Can Öztürk Author-X-Name-First: Can Author-X-Name-Last: Öztürk Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Turkey Abstract: As it is not a member of the European Union, Turkey has not yet adopted EU accounting directives by law. Instead, Turkish standard setting authority adopted International Financial Reporting Standards for entities that have public accountability and has recently prepared the draft Turkish financial reporting standard for non-publicly accountable entities that are subject to independent audit: Framework for Local Financial Reporting. This national standard is influenced by European accounting directive 2013/34, international financial reporting practices and UK experience in addition to national accounting rules. Journal: Accounting in Europe Pages: 226-234 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1304647 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1304647 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:226-234 Template-Type: ReDIF-Article 1.0 Author-Name: Araceli Mora Author-X-Name-First: Araceli Author-X-Name-Last: Mora Title: The Role and the Current Status of IFRS in the Completion of National Accounting Rules – Evidence from Spain Abstract: The way Spain adapted the legislation to the Accounting Directives as well as a brief analysis of the Spanish standard setting process is followed by a description of the influence of International Financial Reporting Standards (IFRS) is the Spanish legislation and the different stakeholders’ position on IFRS. We show and explain why the local General Accepted Accounting Principles (GAAP) are clearly inspired by IFRS principles, even for Small- and Medium-Size entities, while at the same time there is no direct application of IFRS and no mention of IFRS as a complementary source of interpretation. We explain the influence of different stakeholders in the standard setting process and highlight the mostly positive attitude towards IFRS principles. We also show the major differences between the IFRS and local GAAP. Journal: Accounting in Europe Pages: 199-206 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1307998 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1307998 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:199-206 Template-Type: ReDIF-Article 1.0 Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Title: The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from European Countries Abstract: I present a summary and analysis of a series of papers from this special issue of Accounting in Europe that examine the role and current status of International Financial Reporting Standard (IFRS) in the completion of National Accounting Rules applicable to large ‘non-listed in a regulated market’ non-financial undertakings trading for gain in 25 European countries following the recent implementation of the new European Accounting Directive 2013/34/EU. IFRS has had a varying degree of influence across European countries. Some refer and are closely aligned to IFRS or to IFRS for small and medium-sized entities, some while influenced by IFRS retain complete independence and some show limited influence mostly when accounts are for other purposes such as taxation, dividend distribution or creditor protection. I present a number of classification schemes and contrast these with Nobes [(2008). Accounting classification in the IFRS Era. Australian Accounting Review, 18(3), 191–198] two group accounting classification of European accounting systems as strong equity/commercially driven versus weak equity/government driven/tax-dominated systems. Journal: Accounting in Europe Pages: 1-12 Issue: 1-2 Volume: 14 Year: 2017 Month: 5 X-DOI: 10.1080/17449480.2017.1319965 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1319965 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:1-2:p:1-12 Template-Type: ReDIF-Article 1.0 Author-Name: Stefanie Ceustermans Author-X-Name-First: Stefanie Author-X-Name-Last: Ceustermans Author-Name: Diane Breesch Author-X-Name-First: Diane Author-X-Name-Last: Breesch Author-Name: Joël Branson Author-X-Name-First: Joël Author-X-Name-Last: Branson Title: Voluntary Disclosure of Sales and the Extent of Trade Credit in Small Private Companies Abstract: We examine the association between voluntary financial disclosure and the amount of obtained trade credit in a sample of small private Belgian companies. We argue that voluntary disclosure can help small private companies in mitigating information asymmetries that arise between the company and their suppliers. Using a propensity score matching procedure to control for selection bias, we find that voluntary financial disclosure by small and private companies is positively related to the level of trade credit. This is in line with the traditional view that asymmetric or incomplete information restricts access to external funds. Journal: Accounting in Europe Pages: 388-406 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1282617 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1282617 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:388-406 Template-Type: ReDIF-Article 1.0 Author-Name: Tânia Menezes Montenegro Author-X-Name-First: Tânia Author-X-Name-Last: Menezes Montenegro Title: Accounting, Capitalism and the Revealed Religions – A Study of Christianity, Judaism and Islam Journal: Accounting in Europe Pages: 430-433 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1292039 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1292039 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:430-433 Template-Type: ReDIF-Article 1.0 Author-Name: Camelia Iuliana Lungu Author-X-Name-First: Camelia Iuliana Author-X-Name-Last: Lungu Author-Name: Chirața Caraiani Author-X-Name-First: Chirața Author-X-Name-Last: Caraiani Author-Name: Cornelia Dascălu Author-X-Name-First: Cornelia Author-X-Name-Last: Dascălu Title: The Impact of IFRS Adoption on Foreign Direct Investments: Insights for Emerging Countries Abstract: International Financial Reporting Standards (IFRS) adoption research supports the arguments of an increase in the credibility of corporate financial information. We investigate the association between IFRS adoption and foreign direct investments (FDI) inflows. The aim is to analyse several characteristics of the adoption process specific to European emerging countries. Our results indicate that the countries adopting IFRS are more likely to benefit from a higher increase in FDI inflows than the non-adopters. Additional tests reveal that the impact is driven by the adoption level related both to listed and unlisted companies. IFRS adoption by unlisted companies has a lower impact on FDI inflows, as compared to IFRS adoption by listed companies. Furthermore, difference-in-difference analysis illustrates a higher increase of FDI inflows after adopting IFRS in the case of non-European Union (EU) countries as compared to EU countries. Journal: Accounting in Europe Pages: 331-357 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1374546 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1374546 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:331-357 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Author-Name: Anna Alon Author-X-Name-First: Anna Author-X-Name-Last: Alon Title: Layering of IFRS and Dual Institutionality of Accounting Standards in Belarus Abstract: There is an ongoing debate about the applicability and efficacy of International Financial Reporting Standards (IFRS) adoption in countries with diverse institutional infrastructures. We examine financial reporting in Belarus and factors that are shaping its development. In Belarus, IFRS has been adopted through layering where it is an additional requirement to the existing reporting specified by the national accounting regulations. We explore how global standards were transposed and function in a highly specific institutional context. Based on an examination of reporting in the banking sector, we conclude that different objectives of IFRS and local reporting contribute to dual institutionality of standards where differing formats target the needs of diverse users. Thus, adoption through layering is unlikely to contribute to convergence between different reporting standards used for different purposes, and parallel reporting is expected to persist. By examining financial reporting practices in Belarus, we provide insights for practitioners, regulators, and standard-setters on implementation of IFRS in countries with similar heavy state involvement, and still using local regulations and traditions in parallel with IFRS. Journal: Accounting in Europe Pages: 261-278 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1374547 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1374547 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:261-278 Template-Type: ReDIF-Article 1.0 Author-Name: Axel Haller Author-X-Name-First: Axel Author-X-Name-Last: Haller Author-Name: Michael Link Author-X-Name-First: Michael Author-X-Name-Last: Link Author-Name: Tobias Groß Author-X-Name-First: Tobias Author-X-Name-Last: Groß Title: The Term ‘Non-financial Information’ – A Semantic Analysis of a Key Feature of Current and Future Corporate Reporting Abstract: Accounting and corporate reporting can be seen as a language for specific purposes. Such a language requires the use of terms and concepts with a precise and commonly shared meaning to allow effective and efficient communication. We analyze the term ‘non-financial information’, which has become a part of mandatory corporate reporting within the European Union (EU) through recent regulatory actions. Our analysis is based on a survey of the theoretical and empirical literature, on the rational of semantic theory, as well as on a questionnaire survey. The clear finding is that, up to now, neither a common meaning nor a generally accepted definition of ‘non-financial information’ exists. We derive from the applied theoretical concepts that this situation negatively impacts the efficiency and effectiveness of corporate communication. Against this background we discuss several venues that might help to overcome this deficiency like issuing a mandatory guideline or changing the terminology. Journal: Accounting in Europe Pages: 407-429 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1374548 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1374548 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:407-429 Template-Type: ReDIF-Article 1.0 Author-Name: Mădălina Dumitru Author-X-Name-First: Mădălina Author-X-Name-Last: Dumitru Author-Name: Justyna Dyduch Author-X-Name-First: Justyna Author-X-Name-Last: Dyduch Author-Name: Raluca-Gina Gușe Author-X-Name-First: Raluca-Gina Author-X-Name-Last: Gușe Author-Name: Joanna Krasodomska Author-X-Name-First: Joanna Author-X-Name-Last: Krasodomska Title: Corporate Reporting Practices in Poland and Romania – An Ex-ante Study to the New Non-financial Reporting European Directive Abstract: The European Directive 2014/95/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups is applicable by European Union-based entities starting with the financial year commencing on 1 January 2017. Central and Eastern European (CEE) countries are reported to face difficulties when implementing new European or global accounting regulations and models. We investigate the quality of non-financial disclosures in Poland and Romania, the biggest CEE countries, prior to the European Directive’s adoption and explain the diffusion of this type of reporting through the lens of the institutional pressures. We find that prior regulation, local institutional characteristics, ownership, industry and auditors have an impact on the quality of disclosures. Poland experienced a higher extent of voluntary reporting, but Romania faced prior regulatory demands for non-financial reporting (NFR). We find that the overall disclosure score is higher for Romania, which provides support for the importance of regulations to strengthen the spread and quality of NFR. The research findings are relevant to practice and policy. This ex-ante evaluation of reporting practices and of their determinants is useful to understand how change occurs in practice and how companies react to regulatory and other institutional demands. Journal: Accounting in Europe Pages: 279-304 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1378427 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1378427 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:279-304 Template-Type: ReDIF-Article 1.0 Author-Name: Dominika Hadro Author-X-Name-First: Dominika Author-X-Name-Last: Hadro Author-Name: Karol Marek Klimczak Author-X-Name-First: Karol Marek Author-X-Name-Last: Klimczak Author-Name: Marek Pauka Author-X-Name-First: Marek Author-X-Name-Last: Pauka Title: Impression Management in Letters to Shareholders: Evidence from Poland Abstract: We study impression management in an emerging market setting with high ownership concentration. Using content analysis, we identify impression management techniques in a sample of letters to shareholders written in the Polish language by the 60 largest companies listed at the Warsaw Stock Exchange in 2008 and 2013. We find patterns in the occurrence of these techniques with the use of k-means clustering: the largest cluster includes letters that praise the management, while the rest include defensive arguments, discussions of negative outcomes and short, formal letters. The more concentrated ownership is, the shorter the letters are, which indicates that management invest less effort in communicating with investors. This is particularly visible in companies held by insiders, which tend to produce short, formal letters, devoid of impression management. In contrast, companies controlled by foreign shareholders prepare letters that are longer and which are more likely to present defensive arguments, while institutional non-controlling shareholders favour extensive disclosure. The results shed light upon communication practices in Central and Eastern Europe, and offer implications for regulators and managers that may help strengthen the information environment in regional stock markets. Journal: Accounting in Europe Pages: 305-330 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1378428 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1378428 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:305-330 Template-Type: ReDIF-Article 1.0 Author-Name: Aljosa Valentincic Author-X-Name-First: Aljosa Author-X-Name-Last: Valentincic Author-Name: Ales Novak Author-X-Name-First: Ales Author-X-Name-Last: Novak Author-Name: Urska Kosi Author-X-Name-First: Urska Author-X-Name-Last: Kosi Title: Accounting Quality in Private Firms During the Transition Towards International Standards Abstract: We study the historical development of Slovenian Accounting Standards (SAS) and their association with accounting quality (AQ). We focus on private firms where the financial reporting process is characterised by low demand for high-quality reporting. We investigate three distinct editions of SAS since 1994 and test how their development towards international standards is related to AQ. Aggregate earnings management measures indicate that the use of accounting discretion decreases with less earnings smoothing over time. The main features of AQ have been consistent throughout historical development. Asymmetric timeliness of earnings, the ability of earnings to predict future cash flows, and the ability of accruals to mitigate mismatching are all present throughout. We also document typical departures from properties of high AQ. For example, accruals do not (always) facilitate timely recognition of losses. However, these can be attributed to the overwhelming influence of reporting incentives (e.g. taxation, debt, size) rather than to the (lower) quality of accounting standards. Journal: Accounting in Europe Pages: 358-387 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1378821 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1378821 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:358-387 Template-Type: ReDIF-Article 1.0 Author-Name: Nadia Albu Author-X-Name-First: Nadia Author-X-Name-Last: Albu Author-Name: Cătălin Nicolae Albu Author-X-Name-First: Cătălin Nicolae Author-X-Name-Last: Albu Author-Name: Andrei Filip Author-X-Name-First: Andrei Author-X-Name-Last: Filip Title: Corporate Reporting in Central and Eastern Europe: Issues, Challenges and Research Opportunities Abstract: The purpose of this paper, building upon the papers included in this special section of Accounting in Europe on Corporate reporting in CEE countries and on our knowledge of the region, is to broaden out and open up dialogue and debate about how local institutions are evolving and impact the corporate reporting practices in this under-researched region. We begin by discussing the institutional context for conducting research on corporate reporting by entities in Central and Eastern Europe (CEE), within the broader context of emerging, transitional economies. We also reflect on how research conducted on CEE countries can make a relevant contribution to the international literature, and exemplify by summarizing the research questions and findings of the papers included in the special section. A future research agenda emerges, given the gaps in the international literature and the future research implications suggested in the papers constituting the special section. Journal: Accounting in Europe Pages: 249-260 Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1385819 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1385819 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:249-260 Template-Type: ReDIF-Article 1.0 Author-Name: The Editors Title: Editorial Board Journal: Accounting in Europe Pages: ebi-ebi Issue: 3 Volume: 14 Year: 2017 Month: 9 X-DOI: 10.1080/17449480.2017.1401399 File-URL: http://hdl.handle.net/10.1080/17449480.2017.1401399 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:14:y:2017:i:3:p:ebi-ebi Template-Type: ReDIF-Article 1.0 Author-Name: Araceli Mora Author-X-Name-First: Araceli Author-X-Name-Last: Mora Author-Name: Anne McGeachin Author-X-Name-First: Anne Author-X-Name-Last: McGeachin Author-Name: Mary E. Barth Author-X-Name-First: Mary E. Author-X-Name-Last: Barth Author-Name: Richard Barker Author-X-Name-First: Richard Author-X-Name-Last: Barker Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Author-Name: Peter Joos Author-X-Name-First: Peter Author-X-Name-Last: Joos Title: Fair Value Accounting: The Eternal Debate – AinE EAA Symposium, May 2018 Abstract: The last financial crisis led to a vigorous debate still in place about the pros and cons of fair-value accounting (FVA). While detractors basically argue its potential negative impact on procicality and financial stability or inadequacy in illiquid markets or specific business models, the International Accounting Standards Board (IASB) pushed to extend FVA in the new financial instruments standard and issued IFRS 13 to clarify its meaning and application. Some empirical research shows the usefulness of fair value accounting information to investors and contradicts its negative impact on stability, while other studies argue about its limitations in the contracting and stewardship role of accounting. The panelists of this symposium will present their views to contribute to the debate, which should be of interest not just to academic researchers, but also to practitioners and standard setters to deal with implementation issues and potential needs to address in the standards. Journal: Accounting in Europe Pages: 237-255 Issue: 3 Volume: 16 Year: 2019 Month: 9 X-DOI: 10.1080/17449480.2019.1664754 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1664754 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:3:p:237-255 Template-Type: ReDIF-Article 1.0 Author-Name: Ian Dennis Author-X-Name-First: Ian Author-X-Name-Last: Dennis Title: The Conceptual Framework – A ‘Long and Winding Road’ …  Abstract: Understanding the conceptual framework (CF) assists in understanding the issues in its construction. Existing characterisations of the CF as a theory of accounting and as the outcome of a political process are examined and found not to identify essential characteristics or have different interpretations. Recent work on the CF that identifies essential characteristics finds that the CF is something that identifies what is wanted from financial reporting. The paper also identifies issues that arise in constructing it. Various attempts to deal with these issues by those who construct CFs are examined. They are re-described in the light of a better understanding of the nature of a CF. The paper concludes that progress in constructing a future CF will only be made if the nature of the CF is grasped and issues that need to be dealt with, given the new characterisation, are confronted head-on. Journal: Accounting in Europe Pages: 256-289 Issue: 3 Volume: 16 Year: 2019 Month: 9 X-DOI: 10.1080/17449480.2019.1624925 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1624925 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:3:p:256-289 Template-Type: ReDIF-Article 1.0 Author-Name: Selena Aureli Author-X-Name-First: Selena Author-X-Name-Last: Aureli Author-Name: Elisabetta Magnaghi Author-X-Name-First: Elisabetta Author-X-Name-Last: Magnaghi Author-Name: Federica Salvatori Author-X-Name-First: Federica Author-X-Name-Last: Salvatori Title: The Role of Existing Regulation and Discretion in Harmonising Non-Financial Disclosure Abstract: The 2014/95/EU Directive is the first regulatory attempt to harmonise large entities’ non-financial reporting. It sets minimum requirements whilst leaving discretion to Member States in transposing relevant aspects of disclosure. The transposition is the first moment in which the Directive directly impacts on companies and determines whether they will be complying with more similar rules. This study uses the fit/misfit theory to assess the achievement of formal harmonisation between the UK, France and Italy. An analysis of domestic regulations shows that discretion favoured convergence of rules but also the presence of old and new differences. All countries had to engage in some degree of change to be compliant. The UK and France had a high degree of legal fit and used discretion to limit adaptation costs by minimising the legal intervention and over-implementing the Directive respectively. Italy instead welcomed the legal misfit and greatly departed from its previous regulation. Journal: Accounting in Europe Pages: 290-312 Issue: 3 Volume: 16 Year: 2019 Month: 9 X-DOI: 10.1080/17449480.2019.1637529 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1637529 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:3:p:290-312 Template-Type: ReDIF-Article 1.0 Author-Name: Gianfranco Siciliano Author-X-Name-First: Gianfranco Author-X-Name-Last: Siciliano Title: Has IFRS Enhanced Accounting Uniformity? Abstract: I examine the effect of International Financial Reporting Standards (IFRS) adoption on the accounting uniformity of financial statements for a sample of large firms listed on Euronext. Using Taplin’s (A unified approach to the measurement of international accounting harmony*. Accounting and Business Research, 34(1), 57–73) uniformity index, I find that IFRS enhances uniformity of financial statements of firms within the same country (national uniformity) and between countries (international uniformity). The change in uniformity is not, however, homogeneous within and across jurisdictions that are subject to different accounting regulations before IFRS adoption. Those countries whose local GAAP was further from IFRS prior to adoption experience a greater increase in uniformity after IFRS adoption. I also find that international uniformity is increased most for items where IFRS eliminated divergence with local GAAP and for items where no regulation existed under local GAAP; when IFRS preserved the accounting choice set prescribed under local GAAP, uniformity does not increase. The main contribution relies on showing that the various forms of the relationship local GAAP-IFRS prior to the shift matter when examining the direct effect of IFRS adoption on the convergence of financial reporting practices. Journal: Accounting in Europe Pages: 313-339 Issue: 3 Volume: 16 Year: 2019 Month: 9 X-DOI: 10.1080/17449480.2019.1632468 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1632468 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:3:p:313-339 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Author-Name: Clelia Fiondella Author-X-Name-First: Clelia Author-X-Name-Last: Fiondella Author-Name: Marco Maffei Author-X-Name-First: Marco Author-X-Name-Last: Maffei Author-Name: Rosanna Spanò Author-X-Name-First: Rosanna Author-X-Name-Last: Spanò Title: Reporting Comprehensive Income: The Incoherencies of the IASB System and the Possible Contribution of Economia Aziendale Abstract: This paper acknowledges the strong debate on the incoherencies affecting the IASB system, which to date is still inconclusive in the examination of such conceptual weaknesses. We move from this awareness and focus on the debate on income presentation to detect the incoherencies of the IASB accounting system through consideration of specific example IFRSs, on the grounds that the Conceptual framework (CF) and IFRSs, considered together as a set, should all be coherent with each other. We propose a possible pathway to improve such conditions thanks to the concepts and principles of coherent accounting theory, the Italian Economia Aziendale. The paper presents the above-cited incoherencies and proposes areas of improvement and intervention, by showing the possible contribution of the Economia Aziendale theory in aligning standards and superseding incoherence, relying on the two key principles of unitary view and durability. The study extends previous debates, overcoming the lacunae deriving from the well-acknowledged strong emphasis on accounting practice which has long been at the basis of the standard setters in general and the IASB in particular. This is not only relevant for academics, but has importance for preparers, investors, and regulators. Journal: Accounting in Europe Pages: 340-359 Issue: 3 Volume: 16 Year: 2019 Month: 9 X-DOI: 10.1080/17449480.2019.1624923 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1624923 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:16:y:2019:i:3:p:340-359 Template-Type: ReDIF-Article 1.0 Author-Name: The Editors Title: Editorial Board Journal: Accounting in Europe Pages: ebi-ebi Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.618602 File-URL: http://hdl.handle.net/10.1080/17449480.2011.618602 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:ebi-ebi Template-Type: ReDIF-Article 1.0 Author-Name: Metka Duhovnik Author-X-Name-First: Metka Author-X-Name-Last: Duhovnik Title: Time to Endorse the ISAs for European Use: The Emerging Markets' Perspective Abstract: The paper aims to support the endorsement of the International Standards on Auditing (ISAs) from the perspective of an emerging market economy. Pointing to the problems facing the Slovenian audit market as an example of a small market, the paper tries to demonstrate the advantages of endorsing the ISAs for both emerging market economies and the European market as a whole. At the same time, it stresses the importance of a unified audit approach for the overall quality of auditing in Europe, and of treating emerging market economies as an equal partner in international bodies that issue auditing and accounting standards as a necessary condition for those standards to also be applicable to a less developed market environment. Journal: Accounting in Europe Pages: 129-140 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621387 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621387 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:129-140 Template-Type: ReDIF-Article 1.0 Author-Name: Brian Rutherford Author-X-Name-First: Brian Author-X-Name-Last: Rutherford Title: Accounting Research and Accounting Policy: What Kind of Gap? Abstract: This paper is a response to Singleton-Green's examination of the relationship between scholarly financial accounting research and financial accounting policymaking and, in particular, the failure of policymakers to make much use of contemporary research (Accounting in Europe, 7(2), pp. 129–145, 2010). He argues that a major cause of this failure is a communication gap between academics and policymakers but this paper suggests that there is a major gulf between the interests and approaches of the academic and policymaking communities that will not be overcome by improving communication. Thus, his conclusion is too optimistic and may lead policymakers to expect much more from engagement with academic research than they are likely to obtain and academics employing contemporary research paradigms to believe that their work will be received by policymakers with more enthusiasm than is likely to be the case. Journal: Accounting in Europe Pages: 141-154 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621390 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621390 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:141-154 Template-Type: ReDIF-Article 1.0 Author-Name: Cătălin Albu Author-X-Name-First: Cătălin Author-X-Name-Last: Albu Author-Name: Nadia Albu Author-X-Name-First: Nadia Author-X-Name-Last: Albu Author-Name: Robert Faff Author-X-Name-First: Robert Author-X-Name-Last: Faff Author-Name: Allan Hodgson Author-X-Name-First: Allan Author-X-Name-Last: Hodgson Title: Accounting Competencies and the Changing Role of Accountants in Emerging Economies: The Case of Romania Abstract: Over a recent short period, a number of interventions potentially helped move the Romanian accounting system away from being a tool simply used to support a planned economy. They include harmonization with the European Directives, the introduction of International Financial Reporting Standards (IFRS) and an increased move towards modern information technologies such as Enterprise Resource Planning (ERP) software. In this study, we directly explore these influences by applying job-offer analysis as a reflection of the current and future demand for accounting competencies. We first document current competencies expected from accountants in Romanian businesses and then assess the intervention impact on financial and management accountants. We hypothesize external influences would move Romanian accountants away from the traditional separate specialized positions towards more hybrid accounting positions, such as that adopted in the UK. Whilst our analysis supports a degree of transition with alignment to recent global trends, it also reveals some intransigence in the sense that management and financial accounting positions still tend to retain attributes associated with the two-cycle accounting system. Our findings have implications for harmonization issues and accounting education in Romania. Journal: Accounting in Europe Pages: 155-184 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621395 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621395 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:155-184 Template-Type: ReDIF-Article 1.0 Author-Name: Thorsten Knauer Author-X-Name-First: Thorsten Author-X-Name-Last: Knauer Author-Name: Andreas Wömpener Author-X-Name-First: Andreas Author-X-Name-Last: Wömpener Title: Management Forecast Regulation and Practice in Germany – Firm and Auditor Perspectives Abstract: The German regulation on future-oriented reporting is unique in the international context. Its scope is extensive and it specifically pertains to a two-year time horizon in the management forecast section of the annual report. The goal of our research is to provide insights into the perspectives of forecasters on the one hand and auditors on the other, as well as to contrast their viewpoints in order to promote the regulatory debate. Applying the multiple case study method, we exploratively interview forecasters and auditors in order to extract perspectives on the regulation itself, the forecasting process and their mutual relationship. Our main results show that the auditing of forecasts is a regular cause of friction and that most firms and auditors are dissatisfied with the current regulation. In particular, its concreteness and detail are criticised because the forecasting behaviour of firms is generally rather heterogeneous in practice. The management of small enterprises and auditors of smaller firms seem to view management forecasts even more critically. Our research provides evidence for the ongoing regulatory discussion in the German and international contexts and allows for greater insight for both auditors and forecasters into the viewpoints of their respective counterparts. Journal: Accounting in Europe Pages: 185-209 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621398 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621398 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:185-209 Template-Type: ReDIF-Article 1.0 Author-Name: Raf Orens Author-X-Name-First: Raf Author-X-Name-Last: Orens Author-Name: Ann Jorissen Author-X-Name-First: Ann Author-X-Name-Last: Jorissen Author-Name: Nadine Lybaert Author-X-Name-First: Nadine Author-X-Name-Last: Lybaert Author-Name: Leo Van Der Tas Author-X-Name-First: Leo Author-X-Name-Last: Van Der Tas Title: Corporate Lobbying in Private Accounting Standard Setting: Does the IASB have to Reckon with National Differences? Abstract: This paper explores whether the attitude of preparers towards lobbying to a private accounting standard setter is different depending on the regulatory background of the preparers' home country. Prior literature examined the preparers' incentives and characteristics as drivers to participate in the due process of international accounting standard setting, but it did not investigate the impact of the preparers' national regulatory background on participation. As a result of the acceptance of the International Financial Reporting Standards promulgated by the International Accounting Standards Board (IASB) in different countries, preparers who are traditionally accustomed with an accounting standard setting process initiated by governments with few opportunities for formal participation, are now able to participate in a private accounting standard setting process characterised by several possibilities for participation. Comparing survey evidence of Belgian preparers with existing survey evidence of UK preparers, we notice that the participation methods used, the perception on the effectiveness of the participation methods and the reasons for non-participation differ across both groups of preparers. This finding suggests that the national regulatory background of the preparers may affect the behaviour of preparers in their decision to participate in private accounting standard setting. Journal: Accounting in Europe Pages: 211-234 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621672 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621672 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:211-234 Template-Type: ReDIF-Article 1.0 Author-Name: Maja Zaman Groff Author-X-Name-First: Maja Author-X-Name-Last: Zaman Groff Author-Name: Aljoša Valentinčič Author-X-Name-First: Aljoša Author-X-Name-Last: Valentinčič Title: Determinants of Voluntary Audit Committee Formation in a Two-Tier Board System of a Post-transitional Economy – The Case of Slovenia Abstract: This paper investigates the determinants of voluntary audit committee (AC) formation in a setting characterized by: (i) a two-tier board system; (ii) a post-transitional economy. Both factors may affect the system of incentives that influences the decision to form an AC and both factors distinguish this paper from existing studies that are usually done under a unitary-board system in a developed capital market. Only a minority (17%) of companies in our sample had voluntarily established ACs by the time ACs had become mandatory by law. We find that larger firms, firms with larger supervisory boards and firms with less debt (rather than more) are more likely to have voluntarily established an AC. Although the inverse relationship between debt and AC formation contradicts the debt holder–manager conflict it can be explained in the context of a post-transitional economy, where the ownership structure appears not to have stabilized yet and where debt has been used as a means of achieving effective control of firms by insiders. Journal: Accounting in Europe Pages: 235-256 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.621674 File-URL: http://hdl.handle.net/10.1080/17449480.2011.621674 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:235-256 Template-Type: ReDIF-Article 1.0 Author-Name: Lisa Evans Author-X-Name-First: Lisa Author-X-Name-Last: Evans Title: Editorial Journal: Accounting in Europe Pages: 127-128 Issue: 2 Volume: 8 Year: 2011 X-DOI: 10.1080/17449480.2011.633344 File-URL: http://hdl.handle.net/10.1080/17449480.2011.633344 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:8:y:2011:i:2:p:127-128 Template-Type: ReDIF-Article 1.0 Author-Name: Josep Garcia-Blandon Author-X-Name-First: Josep Author-X-Name-Last: Garcia-Blandon Author-Name: Josep M. Argilés-Bosch Author-X-Name-First: Josep M. Author-X-Name-Last: Argilés-Bosch Title: Audit Partner Tenure and Independence in a Low Litigation Risk Setting Abstract: We investigate whether long audit partner tenures impair auditor independence, as proxied by the opinion of the audit report, with a sample of Spanish companies for the period: 2002–2010. The Spanish audit market constitutes an ideal setting in which to address this issue, as it is characterized by unusually lengthy engagements with the audit firm. The motivation relies, on the one hand, on the current discussion about the necessity to reinforce the independence of auditors and, on the other hand, on the very limited available research at the partner level. The main result is the lack of significant effects of partner tenure on independence. This finding is robust to various checks. Unlike prior research, we also address the joint effects of firm and partner tenure on independence. Results indicate that partner tenure does not compromise independence, even under long or extremely long audit firm tenures. These findings might have some interesting policy implications, in particular for the intense current debate on auditor rotation regimes which is taking place within the European Union. Journal: Accounting in Europe Pages: 405-424 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1244340 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1244340 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:405-424 Template-Type: ReDIF-Article 1.0 Author-Name: Francesco Mazzi Author-X-Name-First: Francesco Author-X-Name-Last: Mazzi Author-Name: Giovanni Liberatore Author-X-Name-First: Giovanni Author-X-Name-Last: Liberatore Author-Name: Ioannis Tsalavoutas Author-X-Name-First: Ioannis Author-X-Name-Last: Tsalavoutas Title: Insights on CFOs’ Perceptions about Impairment Testing Under IAS 36 Abstract: We survey CFOs of Italian listed companies and examine their views on the complexities involved in implementing IAS 36 requirements and the perceived usefulness of national guidelines aiming at assisting preparers in this respect. We find that IAS 36 is perceived as an atypical standard among IFRS, it demands subjective interpretation, its requirements can be made adaptable to managerial needs and do not limit creative accounting. Further, respondents do not see a strong link between IAS 36 disclosure requirements and market variables, except for stock returns. Moreover, the impairment testing process became more difficult during the recent financial crisis and guidelines issued by the Italian authorities do not appear to assist in implementing the recoverable amount estimation process or compliance with mandatory disclosure. The respondents explicitly call for a revision in IAS 36 and/or issuance of separate guidance. These findings inter alia respond directly to the IASB’s current quest on financial statements preparers’ concerns about the application of the IAS 36 requirements. Journal: Accounting in Europe Pages: 353-379 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1244341 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1244341 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:353-379 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Title: Confidence games: lawyers, accountants, and the tax shelter industry Journal: Accounting in Europe Pages: 428-430 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1244343 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1244343 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:428-430 Template-Type: ReDIF-Article 1.0 Author-Name: Vicente Condor Author-X-Name-First: Vicente Author-X-Name-Last: Condor Title: Public Sector Accounting and Auditing in Europe. The Challenge of Harmonization Journal: Accounting in Europe Pages: 425-427 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1251601 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1251601 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:425-427 Template-Type: ReDIF-Article 1.0 Author-Name: Alain Schatt Author-X-Name-First: Alain Author-X-Name-Last: Schatt Author-Name: Leonidas Doukakis Author-X-Name-First: Leonidas Author-X-Name-Last: Doukakis Author-Name: Corinne Bessieux-Ollier Author-X-Name-First: Corinne Author-X-Name-Last: Bessieux-Ollier Author-Name: Elisabeth Walliser Author-X-Name-First: Elisabeth Author-X-Name-Last: Walliser Title: Do Goodwill Impairments by European Firms Provide Useful Information to Investors? Abstract: In 2004, the IASB adopted the mandatory annual impairment-test-only of goodwill (IAS 36) instead of amortization of goodwill. We present and discuss the academic literature regarding the association between the goodwill impairment, under this new standard, and the revision of investors’ expectations about a company’s future cash flows. The academic literature highlights that, in some specific cases, IAS 36 may help investors to revise their expectations. More precisely, goodwill impairment seems relevant when: (a) there is strong asymmetry of information between managers and investors, (b) managers disclose detailed information in the notes regarding their own assumptions about future cash flows, and (c) managers do not manage earnings and provide reliable information to investors. In many cases, goodwill impairment is probably useless for investors because they are able to revise their expectations based on public information, or because they cannot trust the accounting numbers and additional information in the notes about the impairment test, which are provided by (undisciplined) managers. More research is, however, needed to understand in which circumstances impairment-test-only is more useful, as well in which cases it is less adequate. Our analysis relates to the current post-implementation review and should be useful to standard-setters. Before any modification, we argue that standard-setters should carefully consider the economic and the institutional contexts when issuing a new accounting standard. Journal: Accounting in Europe Pages: 307-327 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1254348 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1254348 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:307-327 Template-Type: ReDIF-Article 1.0 Author-Name: Marius Gros Author-X-Name-First: Marius Author-X-Name-Last: Gros Author-Name: Daniel Worret Author-X-Name-First: Daniel Author-X-Name-Last: Worret Title: Lobbying and Audit Regulation in the EU Abstract: In this paper, we analyze comment letters submitted in response to the European Commission (EC) Green Paper on audit policy. We find that consistent with the theory of incentives and the presence of information asymmetries between rule-making bodies and interest groups, the highest participation within the consultation process came from auditors and preparers of financial statements. Additionally, our results suggest that these interest groups exhibit different strategic lobbying behaviors in terms of employing more self-referential arguments than other interest groups. Moreover, we provide evidence that self-referential argumentation strategies are more influential when expressing opposing views, whereas conceptually based argumentation strategies are more influential when expressing supporting views. We contribute to a more detailed understanding of the role that lobbyists and argumentation strategies played in the recent EU audit policy reform, and we infer that lobbying activities might have led the EC to moderate its proposals to obtain interest groups’ support. Journal: Accounting in Europe Pages: 381-403 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1255343 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1255343 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:381-403 Template-Type: ReDIF-Article 1.0 Author-Name: Paul André Author-X-Name-First: Paul Author-X-Name-Last: André Author-Name: Andrei Filip Author-X-Name-First: Andrei Author-X-Name-Last: Filip Author-Name: Luc Paugam Author-X-Name-First: Luc Author-X-Name-Last: Paugam Title: Examining the Patterns of Goodwill Impairments in Europe and the US Abstract: We examine the patterns of goodwill impairments in Europe and in the US over the period from 2006 to 2015, for a sample of more than 35,000 firm-year observations. We define the timeliness of goodwill impairments as the frequency of accounting impairments conditional to indications of economic impairments. We measure indications of economic impairment with three metrics: equity market value minus equity book value less than goodwill, market-to-book smaller than one and negative earnings before interest, tax, depreciation and amortisation (EBITDA). Our research strategy leads us to draw very different conclusions than those in the recent EFRAG (2016) study. While median levels of goodwill on the books between US and European firms are relatively similar, we find several indications that US firms recognise timelier impairments, at least during 2008 and 2009, that is, the early years of the financial crisis. We further document that US impairers write down a much greater percentage of their beginning balance of goodwill than European impairers. During the financial crisis, the median level of impairment by US firms was 63% of opening goodwill in 2008 and 40% in 2009, whereas median European write-downs were only 6% and 7% of opening goodwill, respectively. Even though European firms are more likely to impair over multiple years, the cumulative impairments never come close to the level of US firms, be it in a single year or cumulative over multiple years. We also find that the frequency of accounting impairment is small compared to the number of firms presenting evidence of economic impairment: only 20–25% of firms recognise impairments depending on the measure of economic impairment. This has often been interpreted by academics as a sign of untimely write-offs. Accounting differences between US Generally Accepted Accounting Principles and International Financial Reporting Standards are unlikely to explain our results. One caveat of our analysis is that it does not allow us to draw conclusions on whether the observed differences between US and European firms are driven by differences in conditional conservatism and/or big bath accounting practices. Journal: Accounting in Europe Pages: 329-352 Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1260748 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1260748 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:329-352 Template-Type: ReDIF-Article 1.0 Author-Name: The Editors Title: Editorial Board Journal: Accounting in Europe Pages: ebi-ebi Issue: 3 Volume: 13 Year: 2016 Month: 9 X-DOI: 10.1080/17449480.2016.1271552 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1271552 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:3:p:ebi-ebi Template-Type: ReDIF-Article 1.0 Author-Name: Mara Cameran Author-X-Name-First: Mara Author-X-Name-Last: Cameran Author-Name: Domenico Campa Author-X-Name-First: Domenico Author-X-Name-Last: Campa Title: Comments by the European Accounting Association on the International Accounting Education Standards Board Consultation Paper ‘Meeting Future Expectations of Professional Competence: A Consultation on the IAESB’s Future Strategy and Priorities’ Abstract: On December 2015, the International Accounting Education Standards Board (IAESB) issued a consultation paper entitled ‘Meeting future expectations of professional competence: A consultation on the IAESB’s future strategy and priorities’. Its aim is ‘to obtain public comment on its vision for the next five years and the strategic priorities it believes need to be addressed in serving the public interest’ [International Accounting Education Standards Board [IAESB]. (2015a). Meeting future expectations of professional competence: A consultation on the IAESB’s future strategy and priorities. Consultation paper. Retrieved from https://www.ifac.org/publications-resources/consultation-paper-meeting-future-expectations-professional-competence, p. 3]. This article reports the answers of the European Accounting Association to the questions asked in the consultation paper. The comments suggest a reinforcement of the entry requirements that would include a proper education background, advanced levels of both some technical competences and interpersonal/communication skills as well as a very strong ethical commitment. They also recommend a more thorough development process for the continuous education of accountants, a stronger link between practitioners and academia, insights for new IESs and more effective communication strategies about IAESB activities. Journal: Accounting in Europe Pages: 295-303 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1201578 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1201578 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:295-303 Template-Type: ReDIF-Article 1.0 Author-Name: C. Richard Baker Author-X-Name-First: C. Richard Author-X-Name-Last: Baker Title: American Accountants and their Contributions to Accounting Thought, 1900–1930 Journal: Accounting in Europe Pages: 305-306 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1203070 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1203070 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:305-306 Template-Type: ReDIF-Article 1.0 Author-Name: Begoña Giner Author-X-Name-First: Begoña Author-X-Name-Last: Giner Author-Name: Niclas Hellman Author-X-Name-First: Niclas Author-X-Name-Last: Hellman Author-Name: Ann Jorissen Author-X-Name-First: Ann Author-X-Name-Last: Jorissen Author-Name: Alberto Quagli Author-X-Name-First: Alberto Author-X-Name-Last: Quagli Author-Name: Amine Taleb Author-X-Name-First: Amine Author-X-Name-Last: Taleb Title: On the ‘ EAA’s Financial Reporting Standards Committee’s View Abstract: In July 2015 the International Financial Reporting Standards (IFRS) Foundation launched its third five year review of its structure and effectiveness of the organisation. In a public call, the Trustees solicited stakeholders’ input on the relevance of IFRS Standards with respect to broadening the IFRS scope and to the impact of new technology, on the consistent application of IFRS and on the governance and funding of the International Accounting Standards Board and the IFRS Foundation. The European Accounting Association (EAA)’s Financial Reporting Standards Committee responded to this request for views by submitting a comment letter based on research-informed opinions. This article provides an overview of this Review of Structure and Effectiveness of the IFRS Foundation and the EAA’s opinions in response to this Review. Journal: Accounting in Europe Pages: 285-294 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1205205 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1205205 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:285-294 Template-Type: ReDIF-Article 1.0 Author-Name: Günther Gebhardt Author-X-Name-First: Günther Author-X-Name-Last: Gebhardt Title: Impairments of Greek Government Bonds under IAS 39 and IFRS 9: A Case Study Abstract: International Financial Reporting Standard 9 (IFRS 9) 9 introduces new impairment rules responding to the G20 critique that International Accounting Standard 39 (IAS 39) results in the delayed and insufficient recognition of credit losses. In a case study of a Greek government bond for the period 2009–2011 when Greece’s credit rating declined sharply, this paper highlights the discretion that preparers have when estimating impairments. IFRS 9 relies more on management expectations and will lead to earlier impairments. However, these appear still delayed and low if compared to the fair value losses. Journal: Accounting in Europe Pages: 169-196 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1208833 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1208833 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:169-196 Template-Type: ReDIF-Article 1.0 Author-Name: Jacqueline Birt Author-X-Name-First: Jacqueline Author-X-Name-Last: Birt Author-Name: Niclas Hellman Author-X-Name-First: Niclas Author-X-Name-Last: Hellman Author-Name: Ann Jorissen Author-X-Name-First: Ann Author-X-Name-Last: Jorissen Author-Name: Stephani Mason Author-X-Name-First: Stephani Author-X-Name-Last: Mason Author-Name: Mari Paananen Author-X-Name-First: Mari Author-X-Name-Last: Paananen Title: What Is the Way Forward for IASB’s Research Programme under the Evidence-Supported Approach? Some Analyses and Comments Based on the 2015 Agenda Consultation Abstract: The purpose of this paper is twofold: (1) the paper reviews the International Accounting Standards Board (IASB's) evidence-supported approach to standard setting, in particular the very broad definition of evidence that does not distinguish between scientific evidence used for developing the normative foundation (the standards) and observations in practice. Based on comparisons with medicine and auditing, we argue that there are good reasons for the IASB to separate scientific evidence from other sources of information. As producers of scientific evidence, the academic community must consider whether better alignment between publishing incentives and standard setting can be achieved. (2) Examining the 2015 Agenda Consultation, the ‘top-five’ research projects were identified: ‘Disclosure Initiative – Principles of Disclosure’, ‘Primary Financial Statements’, ‘Financial Instruments with Characteristics of Equity’, ‘Business Combinations under Common Control’, and ‘Goodwill and Impairment’. In order to further support evidence-informed standard setting, we provide research-based comments on these projects (based on the European Accounting Association's Agenda Consultation comment letter). Journal: Accounting in Europe Pages: 269-283 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1208834 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1208834 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:269-283 Template-Type: ReDIF-Article 1.0 Author-Name: Noor Hashim Author-X-Name-First: Noor Author-X-Name-Last: Hashim Author-Name: Weijia Li Author-X-Name-First: Weijia Author-X-Name-Last: Li Author-Name: John O’Hanlon Author-X-Name-First: John Author-X-Name-Last: O’Hanlon Title: Expected-loss-based Accounting for Impairment of Financial Instruments: The FASB and IASB Proposals 2009–2016 Abstract: The financial and banking crisis of the late 2000s prompted claims that the incurred-loss method for the recognition of credit losses had caused undesirable delay in the recognition of credit-loss impairment. In the wake of the crisis, the US Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) worked towards the development of expected-loss-based methods of accounting for credit-loss impairment. Their work included an ultimately unsuccessful attempt to develop a converged FASB/IASB standard on credit-loss impairment. The FASB and IASB eventually developed their own separate expected-loss models to be included, respectively, in a 2016 FASB standard and in the IASB’s 2014 final version of IFRS 9 Financial Instruments. The failure to achieve convergence on an issue of such high profile and materiality has generated some controversy, and it is claimed that it will impose significant costs on the preparers and users of the financial statements of banks. This paper examines the various sets of expected-loss-based proposals issued separately or jointly since 2009 by the FASB and the IASB. It describes and compares key features of the different approaches eventually developed by the two standard setters, referring to issues that arose in arriving at practically workable solutions and to issues that may have impeded FASB/IASB convergence. It also provides information indicative of the possible effect of differences between the two approaches. Journal: Accounting in Europe Pages: 229-267 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1210179 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1210179 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:229-267 Template-Type: ReDIF-Article 1.0 Author-Name: Zoltán Novotny-Farkas Author-X-Name-First: Zoltán Author-X-Name-Last: Novotny-Farkas Title: The Interaction of the IFRS 9 Expected Loss Approach with Supervisory Rules and Implications for Financial Stability Abstract: This paper examines the interaction of the International Financial Reporting Standard (IFRS) 9 expected credit loss (ECL) model with supervisory rules and discusses potential implications for financial stability in the European Union. Compared to the incurred loss approach of IAS 39, the IFRS 9 ECL model incorporates earlier and larger impairment allowances and is more closely aligned with regulatory expected loss. The earlier recognition of credit losses will reduce the build-up of loss overhangs and the overstatement of regulatory capital. In addition, extended disclosure requirements are likely to contribute to more effective market discipline. Through these channels IFRS 9 might enhance financial stability. However, due to the reliance on point-in-time estimates of the main input parameters (probability of default and loss given default) IFRS 9 ECLs will increase the volatility of regulatory capital for some banks. Furthermore, the ECL model provides significant room for managerial discretion. Bank supervisors might play an important role in the implementation of IFRS 9, but too much supervisory intervention bears the risk of introducing a prudential bias into loan loss accounting that compromises the integrity of financial reporting. Overall, the potential benefits of the standard will crucially depend on its proper and consistent application across jurisdictions. Journal: Accounting in Europe Pages: 197-227 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1210180 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1210180 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:197-227 Template-Type: ReDIF-Article 1.0 Author-Name: Jannis Bischof Author-X-Name-First: Jannis Author-X-Name-Last: Bischof Author-Name: Holger Daske Author-X-Name-First: Holger Author-X-Name-Last: Daske Title: Interpreting the European Union’s IFRS Endorsement Criteria: The Case of IFRS 9 Abstract: EU Regulation requires that any international accounting standards (International Financial Reporting Standards, IFRS) and interpretations (IFRIC) pronounced by the International Accounting Standards Board (IASB) meet three sets of criteria before they become binding for EU-based companies: a ‘true and fair view’ criterion, a list of qualitative criteria, and a ‘European public good’ criterion. During the endorsement process, EU institutions evaluate each standard or interpretation’s compliance with these three criteria. Nevertheless, despite plenty of past endorsement decisions, there is still disagreement about a unanimous interpretation of the criteria in the literature. In this study, we interpret all three criteria against the background of European accounting law and academic accounting research. Then, the paper illustrates for the case of the new IFRS 9 standard on accounting for financial instruments how these criteria can be applied in the endorsement practice. We conclude that the standard cannot reasonably be rejected on grounds of the IAS Regulation. We also explain that the vagueness of the endorsement criteria and the inherent discretion in the eventual endorsement decision help maintain the EU’s political influence on the IASB’s standard-setting ex ante. Journal: Accounting in Europe Pages: 129-168 Issue: 2 Volume: 13 Year: 2016 Month: 5 X-DOI: 10.1080/17449480.2016.1210181 File-URL: http://hdl.handle.net/10.1080/17449480.2016.1210181 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:13:y:2016:i:2:p:129-168 Template-Type: ReDIF-Article 1.0 Author-Name: Cristina Abad Author-X-Name-First: Cristina Author-X-Name-Last: Abad Author-Name: Elisabetta Barone Author-X-Name-First: Elisabetta Author-X-Name-Last: Barone Author-Name: Benita M. Gullkvist Author-X-Name-First: Benita M. Author-X-Name-Last: Gullkvist Author-Name: Niclas Hellman Author-X-Name-First: Niclas Author-X-Name-Last: Hellman Author-Name: Ana Marques Author-X-Name-First: Ana Author-X-Name-Last: Marques Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Stephani Mason Author-X-Name-First: Stephani Author-X-Name-Last: Mason Author-Name: Ricardo Luiz Menezes Silva Author-X-Name-First: Ricardo Luiz Menezes Author-X-Name-Last: Silva Author-Name: Ana Morais Author-X-Name-First: Ana Author-X-Name-Last: Morais Author-Name: Soledad Moya Gutierrez Author-X-Name-First: Soledad Author-X-Name-Last: Moya Gutierrez Author-Name: Alberto Quagli Author-X-Name-First: Alberto Author-X-Name-Last: Quagli Author-Name: Anna Vysotskaya Author-X-Name-First: Anna Author-X-Name-Last: Vysotskaya Title: On the ‘Disclosure Initiative – Principles of Disclosure’: The EAA Financial Reporting Standards Committee’s View Abstract: This paper summarises the contents of a comment letter produced by a working group of 12 academics in response to the International Accounting Standards Board (IASB) Discussion Paper on principles of disclosure. The comment letter was submitted by the Financial Reporting Standards Committee (FRSC) of the European Accounting Association (EAA). The work includes reviews of relevant academic literature of areas related to the various questions posed by the IASB in the Discussion Paper, including the ‘disclosure problem’ and the objective of the project, the suggested principles of effective communication, the roles of the primary financial statements and notes, the location of information and the use of performance measures. The paper also discusses the disclosure of accounting policies, the objectives of centralised disclosure, and the New Zealand Accounting Standards Board staff’s approach to disclosure. Journal: Accounting in Europe Pages: 1-32 Issue: 1 Volume: 17 Year: 2020 Month: 1 X-DOI: 10.1080/17449480.2019.1664753 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1664753 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:1:p:1-32 Template-Type: ReDIF-Article 1.0 Author-Name: Christoph Pelger Author-X-Name-First: Christoph Author-X-Name-Last: Pelger Title: The Return of Stewardship, Reliability and Prudence – A Commentary on the IASB’s New Conceptual Framework Abstract: In March 2018, the IASB published its revised conceptual framework including notable changes to the chapters on the objective of financial reporting and on qualitative characteristics. The IASB put more emphasis on stewardship as part of the decision usefulness objective, reintroduced prudence as an aspect of neutrality and introduced a tolerable level of measurement uncertainty (as a successor to reliability) as part of faithful representation. The present paper discusses the substance of and reasons for these changes in light of the history of the IASB’s work on conceptual frameworks. The paper also explores the possible impact of these changes on the IASB’s future standard-setting by looking at the other chapters of the IASB’s new framework. This paper finds that the more pronounced role of stewardship and the reintroduction of prudence do not seem to entail a revised conceptual thinking of the IASB in the other chapters, while the introduction of a tolerable level of measurement uncertainty provides the IASB with a conceptual tool with the potential to substantially affect future standard-setting debates. However, its positioning as part of faithful representation is questioned and an alternative arrangement of qualitative characteristics suggested. Journal: Accounting in Europe Pages: 33-51 Issue: 1 Volume: 17 Year: 2020 Month: 1 X-DOI: 10.1080/17449480.2019.1645960 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1645960 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:1:p:33-51 Template-Type: ReDIF-Article 1.0 Author-Name: Sameh Kobbi-Fakhfakh Author-X-Name-First: Sameh Author-X-Name-Last: Kobbi-Fakhfakh Author-Name: Ridha Mohamed Shabou Author-X-Name-First: Ridha Mohamed Author-X-Name-Last: Shabou Author-Name: Benoît Pigé Author-X-Name-First: Benoît Author-X-Name-Last: Pigé Title: Intensive Board Monitoring, Investor Protection and Segment Disclosure Quality: Evidence from EU Abstract: This study examined the association between intensive board monitoring (IBM) and segment disclosure quality (SDQ). It also investigated whether this association can be moderated by firm's home country investor protection (IP) level. Based on a panel of 271 non-financial European Union (EU) listed corporations covering the 2007–2012 period, this study estimated two multiple regression models including industry and year fixed effects. We found evidence that the segment disclosure quality is higher when a majority of outside directors serve on monitoring committees. We, also, found that the positive association between IBM and SDQ is more pronounced for firms in a weak IP environment and less pronounced for firms in a strong IP environment. Thus, we provided evidence in favor of a substitutive relationship between IBM and IP level with respect to their association with SDQ. Our findings are evidenced by several robustness tests. Journal: Accounting in Europe Pages: 52-77 Issue: 1 Volume: 17 Year: 2020 Month: 1 X-DOI: 10.1080/17449480.2019.1646427 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1646427 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:1:p:52-77 Template-Type: ReDIF-Article 1.0 Author-Name: Josep Garcia-Blandon Author-X-Name-First: Josep Author-X-Name-Last: Garcia-Blandon Author-Name: Josep Maria Argiles Author-X-Name-First: Josep Maria Author-X-Name-Last: Argiles Author-Name: Diego Ravenda Author-X-Name-First: Diego Author-X-Name-Last: Ravenda Title: On the Relationship between Audit Tenure and Fees Paid to the Audit Firm and Audit Quality Abstract: We investigate the impact of audit firm tenure, partner tenure, audit fees, fees for non-audit services and total fees on audit quality, as measured by discretionary accruals. Our sample consists of Spanish non-financial public companies for the years between 2006 and 2013. Results indicate that audit quality increases with audit firm tenure but decreases with partner tenure. Moreover, the level of fees paid to the audit firm seems to have a negative impact on audit quality, which is mainly driven by fees for audit services. In this regard, we do not observe any significant relationship between fees for non-audit services and audit quality. Our results also show that the negative relationship between either long partner tenures or high fees and audit quality does not occur when the tenure with the audit firm is long. Therefore, long audit firm tenures do not only seem to involve higher audit quality ‘per se’, but also moderate the negative effects of partner tenure and audit fees on audit quality. The results of this study, which are robust to several sensitivity checks, may be relevant for the current debate on auditor rotation and the joint provision of audit and non-audit services. Journal: Accounting in Europe Pages: 78-103 Issue: 1 Volume: 17 Year: 2020 Month: 1 X-DOI: 10.1080/17449480.2019.1669808 File-URL: http://hdl.handle.net/10.1080/17449480.2019.1669808 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:1:p:78-103 Template-Type: ReDIF-Article 1.0 Author-Name: Brigitte Eierle Author-X-Name-First: Brigitte Author-X-Name-Last: Eierle Author-Name: David Shirkhani Author-X-Name-First: David Author-X-Name-Last: Shirkhani Author-Name: Christiane Helduser Author-X-Name-First: Christiane Author-X-Name-Last: Helduser Title: The Need to Provide Internationally Comparable Accounting Information and the Application of IFRS: Empirical Evidence from German Private Firms Abstract: Our study, which is based on a survey carried out among German private firms, aims to ascertain which characteristics determine private firms’ need for providing internationally comparable accounting information and whether or not those firms that perceive such a need actually apply IFRS voluntarily. The relevance of equity from foreign investors and inclusion within an international group are positively associated with this perceived need, whereas international operating activities and a firm’s size are not. Regarding the voluntary adoption of IFRS, both the perceived need and also the interaction between size and need are significant. Our results show that smaller firms, despite perceiving a need for providing their stakeholders with internationally comparable accounting information, often do not apply IFRS. Journal: Accounting in Europe Pages: 323-346 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1445869 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1445869 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:323-346 Template-Type: ReDIF-Article 1.0 Author-Name: Ana Zorio-Grima Author-X-Name-First: Ana Author-X-Name-Last: Zorio-Grima Title: Essays in Honor of Professor Jacques Richard: IFRS in a Global World – International and Critical Perspectives on Accounting Journal: Accounting in Europe Pages: 423-426 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1468912 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1468912 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:423-426 Template-Type: ReDIF-Article 1.0 Author-Name: Alexandra Fontes Author-X-Name-First: Alexandra Author-X-Name-Last: Fontes Title: The Role of the State and Accounting Transparency – IFRS Implementation in Developing Countries Journal: Accounting in Europe Pages: 426-429 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1468913 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1468913 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:426-429 Template-Type: ReDIF-Article 1.0 Author-Name: Derya Vural Author-X-Name-First: Derya Author-X-Name-Last: Vural Title: Disclosure Practices by Family Firms: Evidence from Swedish Publicly Listed Firms Abstract: I investigate the effect of family ownership on firms’ disclosure practices in their annual reports. In specific, I study Swedish publicly listed firms, which are typically characterized by controlling owners that have a strong influence in the corporate governance decisions of the firm, including corporate disclosures. To measure disclosure, I construct a comprehensive disclosure index covering information on (1) corporate governance, (2) strategic and financial targets and (3) notes to the financial statements. The results reveal that overall, family firms provide less disclosure in annual reports than non-family firms do. The finding is consistent with the premise that through their management positions, family owners can directly monitor managers and avoid costly public disclosures. Overall, the results suggest that ownership structure of firms is important to consider in understanding firms’ disclosure incentives, particularly in settings where controlling owners play a significant role in the governance of the firm. Journal: Accounting in Europe Pages: 347-373 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1479531 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1479531 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:347-373 Template-Type: ReDIF-Article 1.0 Author-Name: Ian Dennis Author-X-Name-First: Ian Author-X-Name-Last: Dennis Title: What is a Conceptual Framework for Financial Reporting? Abstract: Despite more than forty years of exploration into constructing a conceptual framework (CF) for financial reporting the question ‘What is a CF?’ has not been adequately answered. The result is that those who construct CFs are not guided by a clear concept of a CF and communication about CFs is undermined by differences in understanding what it is. There has been a failure to undertake conceptual enquiry into the nature of a CF or into the expressions used in describing it. This paper addresses this failure by undertaking such a conceptual enquiry. Existing explanations of CFs are examined and found to be inadequate. What is wanted from a CF is identified and explained and this is used to prescribe what should be understood by the expression ‘conceptual framework’. A new characterisation of CFs is given that should assist any future construction of new CFs. Problems that may be faced by those who seek to construct a CF are identified. Journal: Accounting in Europe Pages: 374-401 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1496269 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1496269 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:374-401 Template-Type: ReDIF-Article 1.0 Author-Name: F. Ayzer Bilgic Author-X-Name-First: F. Ayzer Author-X-Name-Last: Bilgic Author-Name: Sandra Ho Author-X-Name-First: Sandra Author-X-Name-Last: Ho Author-Name: Allan Hodgson Author-X-Name-First: Allan Author-X-Name-Last: Hodgson Author-Name: Zhengling Xiong Author-X-Name-First: Zhengling Author-X-Name-Last: Xiong Title: Do Macro-economic Crises Determine Accounting Value Relevance? Abstract: We investigate whether the value relevance of earnings and book values in Turkey significantly changed across periods of financial uncertainty. Our enquiry differs from the mainstream literature that posits a unidirectional association determined by the ‘quality’ of individual firm accounts towards price. We find divergence in accounting value relevance components across the 1997–2012 period. Dominant value relevance shifts from earnings and negative interest rates in hyper-inflation, to the balance sheet after IFRS in 2005. On the other hand, the global financial crisis (GFC) is associated with diminished accounting value relevance for all variables. Policy issues are raised about value relevance consistency, the use of negative (low) interest rates as fiscal policies and the asymmetric application of market based valuations in emerging economies. Journal: Accounting in Europe Pages: 402-422 Issue: 3 Volume: 15 Year: 2018 Month: 9 X-DOI: 10.1080/17449480.2018.1514123 File-URL: http://hdl.handle.net/10.1080/17449480.2018.1514123 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:15:y:2018:i:3:p:402-422 Template-Type: ReDIF-Article 1.0 Author-Name: Annette Köhler Author-X-Name-First: Annette Author-X-Name-Last: Köhler Author-Name: Nicole Ratzinger-Sakel Author-X-Name-First: Nicole Author-X-Name-Last: Ratzinger-Sakel Author-Name: Jochen Theis Author-X-Name-First: Jochen Author-X-Name-Last: Theis Title: The Effects of Key Audit Matters on the Auditor’s Report’s Communicative Value: Experimental Evidence from Investment Professionals and Non-professional Investors Abstract: We investigate the effect of key audit matters (KAM) in the auditor’s report as required by the new ISA 701. We consider investment professionals and non-professional investors in our experiments, in which we test the communicative value of a KAM section relating to goodwill impairment. Our main results show that in the condition in which the KAM section suggests that already small changes in the key assumptions could eventually lead to a goodwill impairment (KAM negative condition), investment professionals assess the economic situation of the company to be significantly better as compared to the condition in which the KAM section suggests that only large changes in the key assumptions could eventually lead to a goodwill impairment (KAM positive condition). In the additional analysis with non-professional investors, we find that a KAM section has no communicative value, implying that non-professional investors have difficulties with processing the information conveyed with KAM. Journal: Accounting in Europe Pages: 105-128 Issue: 2 Volume: 17 Year: 2020 Month: 7 X-DOI: 10.1080/17449480.2020.1726420 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1726420 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:2:p:105-128 Template-Type: ReDIF-Article 1.0 Author-Name: Begoña Giner Author-X-Name-First: Begoña Author-X-Name-Last: Giner Author-Name: Alessandra Allini Author-X-Name-First: Alessandra Author-X-Name-Last: Allini Author-Name: Annamaria Zampella Author-X-Name-First: Annamaria Author-X-Name-Last: Zampella Title: The Value Relevance of Risk Disclosure: An Analysis of the Banking Sector Abstract: The aim of this study is to test whether financial risk disclosures required by IFRS 7 and Pillar 3 are value relevant for investors to support them in their investment decisions. The sample in the study consists of banks listed on the London, Paris, Frankfurt, Madrid, and Milan Stock Exchanges over an 8-year period, from 2007 to 2014. Based on the aforementioned standards, we built financial risk disclosure indexes and distinguished different risk categories, qualitative and quantitative, as well as credit, liquidity, and market risk. Our analyses confirm that there is a positive association between bank value and several categories of established risk disclosures. Furthermore, it suggests that disclosure adds value to more traditional risk value measures. Besides, our results suggest that investors pay attention to the strength of the bank authority when using risk disclosures. Journal: Accounting in Europe Pages: 129-157 Issue: 2 Volume: 17 Year: 2020 Month: 7 X-DOI: 10.1080/17449480.2020.1730921 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1730921 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:2:p:129-157 Template-Type: ReDIF-Article 1.0 Author-Name: Giorgia Mattei Author-X-Name-First: Giorgia Author-X-Name-Last: Mattei Author-Name: Susana Jorge Author-X-Name-First: Susana Author-X-Name-Last: Jorge Author-Name: Fabio Giulio Grandis Author-X-Name-First: Fabio Giulio Author-X-Name-Last: Grandis Title: Comparability in IPSASs: Lessons to be Learned for the European Standards Abstract: In 2013 the European Commission started addressing issues concerning public sector accounting harmonization across EU Member States, embarking on a project to develop European Public Sector Accounting Standards (EPSASs). Although acknowledging the indisputable reference of the existing International Public Sector Accounting Standards (IPSASs), it highlighted that IPSASs, as they were, could not be suitably applied in the EU context (European Commission, 2013a). IPSASs were considered as not covering specific important matters of public sector accounting, not showing enough stability due to the need of constant convergence with IFRSs, and offering several options that compromised comparability.Comparability of public sector accounts across Member States is one of the main objectives of EPSASs (EUROSTAT, 2016, 2019), clearly established as a qualitative characteristic in the draft EPSAS Conceptual Framework (EUROSTAT, 2018). It is critical for EU economic and fiscal convergence that countries’ accounts allow for substantial comparison and standardized transition to the National Accounts (Jorge et al., 2014).The IPSAS Conceptual Framework (IPSASB, 2014), meanwhile issued, sustains that adopting these standards would improve comparability of General Purpose Financial Reporting (GPFR), in this way strengthening transparency and accountability of public sector finance.Given that, despite the above concerns, EPSASs are to be developed on the basis of IPSASs (European Commission, 2019), the purpose of this paper is to show that IPSASs are not an adequate reference for EPSASs in terms of allowing the desired comparability of countries’ accounts in the EU. It relies on evidence gathered from IPSAS-based financial reports prepared by some Agencies of the United Nations System and from audit reports of the UN Board of Auditors.The research illustrates that IPSASs only allow for de jure comparability of financial reports at a very broad level. Their implementation and interpretation in practice (due to the options permitted and the judgement required) does not allow for de facto comparable GPFR. European standard-setters need to be aware that the comparability EPSASs need to address across EU Member States’ accounts must go beyond the one that is permitted by IPSASs – EPSASs need to stretch IPSASs harmonization to a higher level of standardization. Journal: Accounting in Europe Pages: 158-182 Issue: 2 Volume: 17 Year: 2020 Month: 7 X-DOI: 10.1080/17449480.2020.1742362 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1742362 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:2:p:158-182 Template-Type: ReDIF-Article 1.0 Author-Name: Imam Arafat Author-X-Name-First: Imam Author-X-Name-Last: Arafat Author-Name: Theresa Dunne Author-X-Name-First: Theresa Author-X-Name-Last: Dunne Author-Name: Ahmed Hassan Ahmed Author-X-Name-First: Ahmed Hassan Author-X-Name-Last: Ahmed Title: Splitting Accountability Hairs: Anomalies in the Adaptation of IFRS for SMEs in the UK and Ireland Abstract: Recent years have witnessed a significant shift in the financial reporting frameworks available in the UK and Ireland affecting entities of all sizes with the Financial Reporting Council issuing three financial reporting standards replacing the extant UK GAAP. This paper reports the results of a content analysis of 151 comment letters sent to the standard-setter in response to its policy proposal. The paper explains why the standard-setter stepped back from its controversial proposal to enforce IFRS for SMEs based on the absence of public accountability. Additionally, the standard-setter addressed all concerns positively apart from two, representing two anomalies. First, despite being opposed by the majority of the respondents, the standard-setter published a new framework for wholly-owned subsidiaries of listed companies allowing them to make substantially less disclosure. Second, the standard-setter is yet to respond to the call by the accounting profession and the Not-for-profit sector to publish a sector-specific framework. Journal: Accounting in Europe Pages: 183-203 Issue: 2 Volume: 17 Year: 2020 Month: 7 X-DOI: 10.1080/17449480.2020.1764601 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1764601 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:2:p:183-203 Template-Type: ReDIF-Article 1.0 Author-Name: Viktoria Müller Author-X-Name-First: Viktoria Author-X-Name-Last: Müller Title: Hedge Accounting and its Consequences on Portfolio Earnings – A Simulation Study Abstract: In this paper, I analyze the consequences of cash flow hedge accounting on portfolio earnings of firms focusing on main changes between IFRS 9 and IAS 39. For this purpose, I develop a simulation study which illustrates the quantitative effects on the accounting entries according to the currently applicable hedge accounting methods. It is especially addressed what accounting differences arise and how these distinctions may affect a firm’s earnings. Furthermore, I examine to which firms early switching becomes especially desirable or burdensome. This information is particularly useful to managers and investors. The paper shows that portfolio earnings are affected differently. In the model, IAS 39 may lead to higher or lower earnings for increasing deviations between foreign and domestic interest rates. Additionally, sensitivity to volatility changes varies among the methods. Moreover, a partly ineffective hedging relationship does not necessarily decrease earnings compared to its fully effective counterpart. Journal: Accounting in Europe Pages: 204-237 Issue: 2 Volume: 17 Year: 2020 Month: 7 X-DOI: 10.1080/17449480.2020.1775267 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1775267 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:2:p:204-237 Template-Type: ReDIF-Article 1.0 Author-Name: Begoña Giner Author-X-Name-First: Begoña Author-X-Name-Last: Giner Author-Name: Ann Jorissen Author-X-Name-First: Ann Author-X-Name-Last: Jorissen Title: Special Issue on Accounting and Politics Journal: Accounting in Europe Pages: 239-242 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1841905 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1841905 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:239-242 Template-Type: ReDIF-Article 1.0 Author-Name: Kees Camfferman Author-X-Name-First: Kees Author-X-Name-Last: Camfferman Title: International Accounting Standard Setting and Geopolitics Abstract: This paper reflects on relations between geopolitics and international accounting standard setting in the context of a commonly noted ‘return of geopolitics’. By discussing how selected episodes of the international political setting have impinged on the work of the IASC and the IASB, I attempt to demonstrate that geopolitics is a relevant angle on international accounting standard setting even though many aspects of IFRS can be adequately understood without references to geopolitics. I propose a simple framework to distinguish between symbolical and substantial relations between geopolitics and international accounting standard setting, as well as technical aspects where such a relation is absent. I call for further development of the conceptual toolbox required to analyze the relationship between international accounting standard setting and geopolitics, as well as for more empirical work on the historical and current configurations of this relationship. Journal: Accounting in Europe Pages: 243-263 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1795214 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1795214 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:243-263 Template-Type: ReDIF-Article 1.0 Author-Name: Masatsugu Sanada Author-X-Name-First: Masatsugu Author-X-Name-Last: Sanada Title: Legitimacy of Private Accounting Standard Setters: Literature Review and Suggestions for Future Research Abstract: The purpose of this study is to critically synthesize extant research on the legitimacy of private accounting standard setters in order to inform future research opportunities. This study presupposes that legitimacy is an important issue for the survival of private accounting standard setters who face legitimacy claims from stakeholders and regulatory competition from other standard-setting bodies due to their lack of a democratic foundation. Findings show that the definition, typology, sources, and legitimacy characteristics that researchers use depend on the theoretical perspectives that they employ in their analysis. Simultaneously, they do have some common points despite the difference in their perspectives. Regarding legitimacy changes, prior studies suggest that moving from practical toward cultural legitimacy, the importance of due process, and the role of crises all affect these changes. The review also identifies future research directions as well as several challenges for legitimacy studies in accounting, namely defining an analytical framework, focus on the dynamic nature of legitimacy and output legitimacy, and the need for more empirical studies, among others. Journal: Accounting in Europe Pages: 264-302 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1837889 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1837889 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:264-302 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Walton Author-X-Name-First: Peter Author-X-Name-Last: Walton Title: Accounting and Politics in Europe: Influencing the Standard Abstract: The paper considers the case of lobbying to influence the content or other aspects of a standard within Europe. It reviews the institutional framework to identify opportunities for lobbying and then considers the mechanics and constraints that affect lobbying in this context. Journal: Accounting in Europe Pages: 303-313 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1714065 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1714065 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:303-313 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher Hossfeld Author-X-Name-First: Christopher Author-X-Name-Last: Hossfeld Author-Name: Yvonne Muller-Lagarde Author-X-Name-First: Yvonne Author-X-Name-Last: Muller-Lagarde Author-Name: Lionel Zevounou Author-X-Name-First: Lionel Author-X-Name-Last: Zevounou Title: The Evolution of the European Public Good Assessment in the EU Endorsement Process of IFRS Abstract: Although legally the criteria to adopt IFRS in the EU have not changed since the adoption of the 2002 IAS-Regulation, the way they are assessed evolved over time. The purpose of this paper is to analyse how the European public good (EPG) criterion has been interpreted since the beginning of the EU endorsement process and how it is interpreted today. After retracing the origin of the European public good criterion in the IAS-Regulation we identify different periods in the EU endorsement process where the application of the EPG criterion changed. These changes are explained by a variety of factors, not least the financial crisis of 2008. The scope of what is considered to be part of the EPG has substantially expanded, a trend that is still ongoing. Journal: Accounting in Europe Pages: 314-333 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1818799 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1818799 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:314-333 Template-Type: ReDIF-Article 1.0 Author-Name: Costanza Di Fabio Author-X-Name-First: Costanza Author-X-Name-Last: Di Fabio Title: The use of Public Interest Arguments in the European Accounting Field Abstract: This paper explores how the global standard setter and the European Union (EU) use public interest arguments; the study discusses these in relation to the perceptions of the actors included in the ‘public sphere’. The study examines texts expressing actors’ positions, revealing that the standard setter and the EU employ these arguments rhetorically to safeguard their political position. The findings show that respondents supporting the EU’s arguments are mostly continental, in line with a Europe-centric notion of ‘public’. Additionally, these arguments are often interpreted as a political tool to favour banks’ private interests rather than to safeguard a common interest in the health of the European economy. Further, the EU’s arguments show a potential threat to the IFRS’s status of globally accepted standards. The findings underscore the importance of considering the link between the global level at which standards are developed and their impact on jurisdictions. Journal: Accounting in Europe Pages: 334-366 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1841904 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1841904 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:334-366 Template-Type: ReDIF-Article 1.0 Author-Name: Berit Hartmann Author-X-Name-First: Berit Author-X-Name-Last: Hartmann Author-Name: Jan Marton Author-X-Name-First: Jan Author-X-Name-Last: Marton Author-Name: Josefin Andersson Sols Author-X-Name-First: Josefin Author-X-Name-Last: Andersson Sols Title: IFRS in National Regulatory Space: Insights from Sweden Abstract: Based on two empirical cases, this paper illustrates and comments on the complexities of implementing and enforcing International Financial Reporting Standards (IFRS) in a national setting. The paper sheds light on the difficulties that arise in the local regulatory space when IFRS requirements start to shape national accounting legislation and regulations. The findings suggest that the investor focus and requirements for managerial judgement of IFRS can pose two problems. Firstly, an extended influence of IFRS creates tension with established institutions that have developed in the local accounting tradition. Secondly, local organisations can respond strongly to new IFRS regulations and their potential implementation, even if the contradiction with local practice bears no immediate economic consequence to them. The study contributes to the contextualisation of financial accounting in national culture by highlighting the different understandings and uses of IFRS by actors involved in the Swedish regulatory space. Journal: Accounting in Europe Pages: 367-387 Issue: 3 Volume: 17 Year: 2020 Month: 9 X-DOI: 10.1080/17449480.2020.1824073 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1824073 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:17:y:2020:i:3:p:367-387 Template-Type: ReDIF-Article 1.0 Author-Name: Josette Caruana Author-X-Name-First: Josette Author-X-Name-Last: Caruana Author-Name: Magdalena Kowalczyk Author-X-Name-First: Magdalena Author-X-Name-Last: Kowalczyk Title: The Quest for Audit Quality in the Public Sector Abstract: We assess audit quality in the public sector of two European jurisdictions by using the model developed by English and Guthrie. Accordingly, we analysed the enabling legislations of the two supreme audit institutions in terms of the issues relating to (i) accountability to their respective parliaments; and (ii) independence from their respective executives. The results highlight strong legal provisions that enable independence, and point to some weaknesses regarding accountability. We show that, since the English and Guthrie model was developed in an Australasian context where state audits are designed on the private sector model, the model needs to be amended in order to apply in an European context. Journal: Accounting in Europe Pages: 1-25 Issue: 1 Volume: 18 Year: 2021 Month: 1 X-DOI: 10.1080/17449480.2020.1757731 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1757731 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:1:p:1-25 Template-Type: ReDIF-Article 1.0 Author-Name: David Alexander Author-X-Name-First: David Author-X-Name-Last: Alexander Author-Name: Roberta Fasiello Author-X-Name-First: Roberta Author-X-Name-Last: Fasiello Title: Prudence and Directive 34 – Reality and Rhetoric in Accounting Regulation Abstract: We explore the concept of prudence consistent with Directive 34/2013. There are three strands to our argument: economic, regulatory and legal. From an economic perspective, we demonstrate that neither historical cost nor fair value are designed to achieve long-run operational stability. Regarding regulation, we show that Directive 34 has significantly changed the concept and implications of prudence, in the name of increasing usefulness and relevance. Our legal considerations centre on the Gimle case of 2013, applying its logic to the new regulatory scenario. We note also the concept of the ‘European Public Good’. At various times the EU has suggested four specific components: protection of financial stability, the lack of hindrance to the economic development of the Union, and the objectives of sustainability and long-term investment. To achieve these objectives within the EU we show that it is necessary to follow the logic of our arguments. Journal: Accounting in Europe Pages: 26-42 Issue: 1 Volume: 18 Year: 2021 Month: 1 X-DOI: 10.1080/17449480.2020.1779946 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1779946 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:1:p:26-42 Template-Type: ReDIF-Article 1.0 Author-Name: Francisco J. Lopez-Arceiz Author-X-Name-First: Francisco J. Author-X-Name-Last: Lopez-Arceiz Author-Name: Ana J. Bellostas Author-X-Name-First: Ana J. Author-X-Name-Last: Bellostas Author-Name: Jose M. Moneva Author-X-Name-First: Jose M. Author-X-Name-Last: Moneva Title: Accounting Standards for European Non-profits. Reasons and Barriers for a Harmonisation Process Abstract: Non-profits (NPOs) are one of the key agents in implementing socio-economic policies, financial reporting being relevant for their stakeholders. Different accounting regulations exist in Europe, with no required, common accounting standards to promote these entities’ participation in diverse countries and societies. We analyse the current differences among local accounting regulations related to the elaboration of financial reporting for European NPOs. We accomplish this by considering the primary elements that define an accounting system together with accounting regulations to elaborate on these organisations’ financial statements, and specific operations related to tangible fixed assets, donations and volunteering. Despite there are pressures to promote an isomorphic behaviour in the European context, our results evidence intense differences among European local regulations for NPOs, with origin in diverse cultural and non-profit traditions. Journal: Accounting in Europe Pages: 43-74 Issue: 1 Volume: 18 Year: 2021 Month: 1 X-DOI: 10.1080/17449480.2020.1795215 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1795215 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:1:p:43-74 Template-Type: ReDIF-Article 1.0 Author-Name: Shuai Yuan Author-X-Name-First: Shuai Author-X-Name-Last: Yuan Title: Cost and Informativeness of Regulatory Reports: Evidence from the UK Abstract: The 2006 EU Directive established an EU-wide system for public oversight of the audit profession. In the UK, since 2008 the Financial Reporting Council (FRC) has published inspection reports for major audit firms, which include overall quality ratings for the individual audit engagements of each audit firm under review. This study examines the FRC’s ratings, and measures their impact on audit fees and audit firm switching. A significant increase in audit fees is found when the audit firm has a higher proportion of engagements with deficient ratings, probably arising from the additional effort and resources needed to meet the FRC’s requirements. This impact is more concentrated among clients with Big 4 audit firms. However, there is no evidence that FRC ratings affect clients’ likelihood of switching audit firms, suggesting that inspection results may not signal audit quality, and thus do not affect clients’ audit firm appointment decisions. The results provide evidence that inspection ratings may increase audit costs, but may not be valuable in distinguishing audit quality, and thus have no effect on audit committees’ audit firm appointment decisions. This finding advances understanding of the effectiveness of the audit inspection regime, and provides auditing regulators with guidance on policy making. Journal: Accounting in Europe Pages: 75-101 Issue: 1 Volume: 18 Year: 2021 Month: 1 X-DOI: 10.1080/17449480.2020.1833056 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1833056 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:1:p:75-101 Template-Type: ReDIF-Article 1.0 Author-Name: Stephanie Jana Author-X-Name-First: Stephanie Author-X-Name-Last: Jana Author-Name: Kevin McMeeking Author-X-Name-First: Kevin Author-X-Name-Last: McMeeking Title: Alternative Performance Measures: Determinants of Disclosure Quality – Evidence from Germany Abstract: Alternative performance measures (APMs) might be used to improve the information environment or strategically to mislead the market. The recently introduced European Securities and Markets Authority APM guidelines are intended to enhance corporate financial disclosures. We analyse the disclosure quality and determinants of all types of APMs in management reports of German listed firms for two financial periods. Although the quantity of APM disclosures is extensive, it differs across firms’ characteristics, and there is considerable room for improvement regarding disclosure quality. APM disclosure quality is positively associated with firm size and negatively associated with profitability. However, not all firms’ characteristics can be applied per se as universal determinants of APM disclosure quality, and a distinction must be made between different types of APMs. For example, high ownership concentration is negatively associated particularly with the quality of profitability APMs. Firms’ leverage is positively associated with the disclosure quality of non-profitability APMs. Journal: Accounting in Europe Pages: 102-142 Issue: 1 Volume: 18 Year: 2021 Month: 1 X-DOI: 10.1080/17449480.2020.1829655 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1829655 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:1:p:102-142 Template-Type: ReDIF-Article 1.0 Author-Name: Jan Woudenberg Author-X-Name-First: Jan Author-X-Name-Last: Woudenberg Author-Name: Lisette van der Hel – van Dijk Author-X-Name-First: Lisette Author-X-Name-Last: van der Hel – van Dijk Author-Name: Robert Kamerling Author-X-Name-First: Robert Author-X-Name-Last: Kamerling Title: Auditor’s Reporting in the Dutch Market of Public Interest Entities: Exploring New Developments in a Diverse Market Abstract: As of 2014, the extended auditor’s report has been introduced for all Dutch PIEs, including but not limited to listed entities. With this explorative study, we provide early insights into how reporting on key audit matters and materiality are applied in practice and whether this differs per category of Dutch PIEs. It appears that the Dutch PIE market is a rather heterogeneous market, including a large number of finance and holding companies, which also results in considerable differences regarding the numbers and subjects of key audit matters and the levels and bases of materiality, which could affect the informative value of auditor’s reporting. Therefore, the question arises whether reporting on key audit matters and materiality has the same relevance for all PIEs, while the results may also give reason to make these elements mandatory for companies that are not yet covered by the PIE-definition. Journal: Accounting in Europe Pages: 249-273 Issue: 2 Volume: 18 Year: 2021 Month: 05 X-DOI: 10.1080/17449480.2021.1912371 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1912371 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:2:p:249-273 Template-Type: ReDIF-Article 1.0 Author-Name: Andrei Filip Author-X-Name-First: Andrei Author-X-Name-Last: Filip Author-Name: Ahmad Hammami Author-X-Name-First: Ahmad Author-X-Name-Last: Hammami Author-Name: Zhongwei Huang Author-X-Name-First: Zhongwei Author-X-Name-Last: Huang Author-Name: Anne Jeny Author-X-Name-First: Anne Author-X-Name-Last: Jeny Author-Name: Michel Magnan Author-X-Name-First: Michel Author-X-Name-Last: Magnan Author-Name: Rucsandra Moldovan Author-X-Name-First: Rucsandra Author-X-Name-Last: Moldovan Title: The Value Relevance of Fair Value Levels: Time Trends under IFRS and U.S. GAAP Abstract: The IASB's post-implementation review of IFRS 13 Fair Value Measurement motivates our analysis of the evolution of the value relevance of fair value (FV) levels over time on banks that report under IFRS and U.S. GAAP. For both sets of standards, results provide evidence that is consistent with (1) an increase in value relevance across all three FV levels over time, and (2) a convergence of the value relevance of the three FV levels over time. However, FV levels exhibit systematically higher value relevance under U.S. GAAP compared to IFRS. Such gap has closed to some extent since the enactment of IFRS 13. This evolution is likely due to learning about FV accounting and changes in financial reporting regulations that increased disclosure requirements. These findings confirm the IASB's conclusions that FV levels’ disclosure is useful to users of financial statements, but also emphasizes preparers and investors’ learning over time. Journal: Accounting in Europe Pages: 196-217 Issue: 2 Volume: 18 Year: 2021 Month: 05 X-DOI: 10.1080/17449480.2021.1900581 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1900581 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:2:p:196-217 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Frii Author-X-Name-First: Peter Author-X-Name-Last: Frii Author-Name: Mattias Hamberg Author-X-Name-First: Mattias Author-X-Name-Last: Hamberg Title: What motives shape the initial accounting for goodwill under IFRS 3 in a setting dominated by controlling owners? Abstract: We investigate how different motives shape the initial accounting for goodwill in a setting dominated by controlling owners, using data from 1112 acquisition analyses reported by Swedish listed acquiring firms. In contrast to prior studies, we find no evidence that earnings-based compensation affects the proportion of the purchased price accounted for as goodwill. Instead, we find that when a family-owned firm is the acquirer, a larger proportion of the purchase price is accounted for as goodwill than as specific assets and liabilities. These two findings indicate that controlling owners may curb managerial motives, while controlling family owners apply the discretion of IFRS 3 according to their motives. We also find in this setting that acquisition-related motives have a significant impact on the proportion of the purchased price accounted for as goodwill. Overall, our analyses indicate that the motives shaping goodwill accounting choices depend on the institutional setting. Journal: Accounting in Europe Pages: 218-248 Issue: 2 Volume: 18 Year: 2021 Month: 05 X-DOI: 10.1080/17449480.2021.1912369 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1912369 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:2:p:218-248 Template-Type: ReDIF-Article 1.0 Author-Name: Pierre Astolfi Author-X-Name-First: Pierre Author-X-Name-Last: Astolfi Title: Did the International Financial Reporting Standards Increase the Audit Expectation Gap? An Exploratory Study Abstract: I examine the role of IFRS on the Audit Expectation Gap (AEG). Past research, mostly based on Porter [(1993). An empirical study of the audit expectation-performance gap. Accounting and Business Research, 24(93), 49–68. https://doi.org/10.1080/00014788.1993.9729463]’s work, does not identify the contribution of accounting standards to the AEG. Yet, IFRS may play a crucial role in an auditor’s mission, because accounting standards now result in more complex and more subjective rules and financial statements. I examine whether IFRS are a factor explaining the perception of the AEG and its components by auditors and preparers of financial information. And, if so, what does this impact, more specifically, result from? Using survey data of 158 auditors and preparers of financial information working in an IFRS environment, I find that the contribution of IFRS to the AEG is underestimated while it is, in fact, at least as important as auditing standards. In addition, respondents think that IFRS generated more complexity (especially regarding issues raised by IFRS 9, IAS 36/IFRS 3 or IFRS 2) and more subjectivity, which contributed to the AEG, and led users of financial statements to be more demanding towards auditors. Auditors are perceived as supposed to be able to offset difficulties suffered by investors regarding the complexity and subjectivity of IFRS. However, the capacity of auditors themselves to fully understand the complexities resulting from IFRS may be overestimated. Furthermore, the results show that auditors’ skills and training seem to be insufficient regarding the increasing complexity of IFRS. Lastly, I find that less experienced respondents underestimate the contribution of accounting standards to the AEG. Journal: Accounting in Europe Pages: 166-195 Issue: 2 Volume: 18 Year: 2021 Month: 05 X-DOI: 10.1080/17449480.2020.1865549 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1865549 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:2:p:166-195 Template-Type: ReDIF-Article 1.0 Author-Name: Ruud G. A. Vergoossen Author-X-Name-First: Ruud G. A. Author-X-Name-Last: Vergoossen Author-Name: Ferdy van Beest Author-X-Name-First: Ferdy Author-X-Name-Last: van Beest Title: Management Reports of Dutch Companies: Their Availability and Compliance with Legal Disclosure Requirements Abstract: Unlike the vast majority of the EU member states, the Netherlands incorporated an option provided by the EU Accounting Directive that exempt companies from the obligation to file the management report with the trade register when a copy of it can be obtained from the company upon request. About 60% of the companies use this filing exemption option, but the availability of the management reports of these companies appears to be poor, because they are (very) reluctant to fulfill a request, rejecting it or do not respond to it at all. Therefore, it is interesting to examine whether the choice of how the management report is published, is associated with the level of compliance with disclosure obligations. In order to do that, we create a disclosure score based on the legal disclosure requirements. Multivariate analysis shows that disclosure compliance of management reports that are filed with the trade register is significantly higher than of those not filed but made available by the company. We also find a significant positive relationship between disclosure compliance and the length of management reports. Compliance levels appear not to be significantly associated with the timeliness of publication, company size and the size of the external auditor’s firm. Based on our research findings we advocate the removal of the filing exemption option on management reports. Journal: Accounting in Europe Pages: 143-165 Issue: 2 Volume: 18 Year: 2021 Month: 5 X-DOI: 10.1080/17449480.2020.1829656 File-URL: http://hdl.handle.net/10.1080/17449480.2020.1829656 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:2:p:143-165 Template-Type: ReDIF-Article 1.0 Author-Name: Blerita Korca Author-X-Name-First: Blerita Author-X-Name-Last: Korca Author-Name: Ericka Costa Author-X-Name-First: Ericka Author-X-Name-Last: Costa Author-Name: Federica Farneti Author-X-Name-First: Federica Author-X-Name-Last: Farneti Title: From voluntary to mandatory non-financial disclosure following Directive 2014/95/EU: an Italian case study Abstract: This study investigates the non-financial disclosure in an Italian banking group following Directive 2014/95/EU over a period of eight years, from its voluntary (2013–2017) to mandatory (2018–2020) implementation. The paper relies both on primary and secondary data sources. It first adopts a content analysis on non-financial reports while considering other relevant available material. Second, the study relies upon semi-structured interviews and seminars to gather primary data. The analysis has been interpreted in light of institutional theory in order to understand the institutional forces driving non-financial disclosure. Results show that non-financial disclosure significantly increased in quantity after the regulation; however, the improvement in quality is fairly low, with the exception of themes relevant to the company under investigation. Through the lens of institutional theory, it emerges that an interplay of institutional mechanisms co-existed within the bank, during two periods of reporting for different topics of disclosure. Journal: Accounting in Europe Pages: 353-377 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1933113 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1933113 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:353-377 Template-Type: ReDIF-Article 1.0 Author-Name: Cristina Gianfelici Author-X-Name-First: Cristina Author-X-Name-Last: Gianfelici Author-Name: Nourhene Benyoussef Author-X-Name-First: Nourhene Author-X-Name-Last: Benyoussef Author-Name: Giuseppe Savioli Author-X-Name-First: Giuseppe Author-X-Name-Last: Savioli Title: Exploring the Going Concern Statement, Readability and Length Cues as Indicators of Distress at Italian Companies Abstract: This study explores the going concern statement, readability and length cues as indicators of Italian private companies in default. The results indicate that the disclosures of defaulting companies contain (1) low readability; (2) greater uncertainty and confusing information; and (3) a lengthy going concern statement compared to non-defaulting firms. This is the first study to analyse the going concern statement and its correlation with Italian default by comparing International Financial Reporting Standards (IFRS) and Italian Generally Accepted Accounting Principles (GAAP). Journal: Accounting in Europe Pages: 325-352 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1933112 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1933112 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:325-352 Template-Type: ReDIF-Article 1.0 Author-Name: Vasileios Zisis Author-X-Name-First: Vasileios Author-X-Name-Last: Zisis Title: Start-up Firms and Discretion Over Deferment of Disclosure: An ex Ante and an ex Post Perspective Abstract: We examine deferment in the reporting of financial statements using an alternative measure of reporting delay based on start-up firms’ discretion over the length of the first reporting period. We explore discretion, exercised both by local GAAP adopters and by IFRS adopters, for a sample of Greek start-up firms using both an ex-ante and an ex-post research design. In addition to various factors previously considered by the accounting literature (i.e. performance, leverage, voluntary auditing, and the GAAP regime), we find that liquidity constraints, shareholders’ pressure, and increased noise in accounting measures are associated with a start-up firm’s reporting choice over the length of the first reporting period. Journal: Accounting in Europe Pages: 295-324 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1923765 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1923765 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:295-324 Template-Type: ReDIF-Article 1.0 Author-Name: Shamsun Nahar Author-X-Name-First: Shamsun Author-X-Name-Last: Nahar Author-Name: Mosammet Asma Jahan Author-X-Name-First: Mosammet Asma Author-X-Name-Last: Jahan Title: Do Risk Disclosures Matter for Bank Performance? A Moderating Effect of Risk Committee Abstract: This study examines whether risk disclosure and risk committee are associated with major banks’ performance worldwide. We also test whether the composition of a risk committee moderates (i.e. strengthens or weakens) this relationship. Using 1760 bank-year observations of 160 banks across 45 countries for the years 2006–2016, we find that risk disclosure and risk committees are associated with a bank’s overall performance. In addition, the findings suggest that the composition of a risk committee moderates the relationship between risk disclosure and bank performance. The results support the contention that risk disclosure and risk committee can be used as a channel to optimise the performance of a bank. Conclusions reflect on how the agency, signalling, and resource-based theories inform this phenomenon. This paper advances our understanding of the role of risk committee characteristics on the relationship between risk disclosures and bank performance from both theoretical and empirical perspectives, suggesting risk committee is not a panacea for risk monitoring. However, the existence of a strong risk committee is vital for effective risk governance. Findings from this research may have valuable practical and policy implications, particularly in the banking sector. Journal: Accounting in Europe Pages: 378-406 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1942095 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1942095 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:378-406 Template-Type: ReDIF-Article 1.0 Author-Name: Andrei Filip Author-X-Name-First: Andrei Author-X-Name-Last: Filip Author-Name: Ahmad Hammami Author-X-Name-First: Ahmad Author-X-Name-Last: Hammami Author-Name: Zhongwei Huang Author-X-Name-First: Zhongwei Author-X-Name-Last: Huang Author-Name: Anne Jeny Author-X-Name-First: Anne Author-X-Name-Last: Jeny Author-Name: Michel Magnan Author-X-Name-First: Michel Author-X-Name-Last: Magnan Author-Name: Rucsandra Moldovan Author-X-Name-First: Rucsandra Author-X-Name-Last: Moldovan Title: Convergence in Motion: A Review of Fair Value Levels’ Relevance Abstract: The IFRS 13 post-implementation review by the IASB motivates our investigation on the value relevance of fair value (FV) measurement hierarchy (i.e. level 1, level 2, and level 3). First, using a meta-analysis, which allows us to summarize inconsistent empirical findings, we synthesize studies on the value relevance of the FV hierarchy. Overall, value relevance is lower for level 3 than for levels 1 and 2, but it increases over time. In non-U.S. studies, we note lower value relevance across all levels of FV assets. Underlying asset fundamentals, model risk, and measurement process complexity may contribute to this value relevance gap. Second, from interviews with professionals from financial institutions, we note that, in practice, there has been extensive learning about FV accounting since the 2007–9 Financial Crisis and a formalization of the valuation process that the academic literature has yet to fully recognize. We thus highlight conceptual and methodological issues and areas for research with practical implications. Journal: Accounting in Europe Pages: 275-294 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1912370 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1912370 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:275-294 Template-Type: ReDIF-Article 1.0 Author-Name: Christopher Nobes Author-X-Name-First: Christopher Author-X-Name-Last: Nobes Title: On Translating Goodwill Abstract: The IASB’s plans to reform accounting for goodwill prompt this paper’s discussion of the translation of the signifier ‘goodwill’ (and the related terms: depreciation, amortisation and impairment). As a translation problem, this is unusually interesting because there are at least three different types of goodwill but all with the same signifier in English. The paper begins by noting the difficulties which biblical translators have had with ‘goodwill’. It then outlines the different types of accounting goodwill, recording the many terms used in eight languages. This includes a study of national regulations and the specific problems of translating IFRS. The discussion is extended to include the approaches in different languages about whether or not to distinguish depreciation from amortisation and how to translate ‘impairment’. Implications for researchers and standard-setters are drawn. This includes the need for terms which are accurately defined and which have been chosen with an eye on potential translations problems. Journal: Accounting in Europe Pages: 407-418 Issue: 3 Volume: 18 Year: 2021 Month: 09 X-DOI: 10.1080/17449480.2021.1952284 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1952284 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:18:y:2021:i:3:p:407-418 Template-Type: ReDIF-Article 1.0 Author-Name: Véronique Weber Author-X-Name-First: Véronique Author-X-Name-Last: Weber Author-Name: Anke Müßig Author-X-Name-First: Anke Author-X-Name-Last: Müßig Title: The Effect of Business Strategy on Risk Disclosure Abstract: For a sample of nonfinancial and non-utility firms from the European Economic Area in 2005–2017, we find that a firm’s business strategy is a determinant of the amount of risk factor information in the annual report. Firms with an innovation-oriented prospector strategy report more about their risk factors than firms with an efficiency-oriented defender strategy. This is because, first, these innovation-oriented prospectors face greater risks and uncertainties and the regulator and enforcement institution expect them to report these accordingly in the annual report. Second, given the discretion the firms have in disclosing risks, prospectors are more likely to engage in voluntary disclosure. It seems that the benefits outweigh the costs of revealing proprietary information. Further, our findings reveal that business strategy influences the coverage of the main risk topics and risk disclosure complexity. Additionally, the influence of business strategy on risk disclosure is stronger for small, young, and low-technology firms. Journal: Accounting in Europe Pages: 190-225 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.2018473 File-URL: http://hdl.handle.net/10.1080/17449480.2021.2018473 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:190-225 Template-Type: ReDIF-Article 1.0 Author-Name: Katrin Hummel Author-X-Name-First: Katrin Author-X-Name-Last: Hummel Author-Name: Manuel Szekely Author-X-Name-First: Manuel Author-X-Name-Last: Szekely Title: Disclosure on the Sustainable Development Goals – Evidence from Europe Abstract: This study examines disclosure on the sustainable development goals (SDGs) in firms’ annual reports. For a sample of European firms listed in the STOXX Europe-600 index and a reporting period of four years, we use textual analysis to assess both firms’ explicit reference to the SDGs in their annual reports as well as the implicit prevalence of SDG topics. In addition, we use content analysis to manually assess the quality of firms’ disclosure on the SDGs based on eleven reporting items. The results show a substantial increase in SDG reporting quality over time but a distinct lack of disclosure of quantitative and forward-looking information. Further analyses reveal the relevance of both financial and non-financial stakeholders. Specifically, SDG disclosure is particularly associated with a high relevance of socially responsible investors, customers or environment-related public pressure, while financial analysts, employees and the media are not associated with SDG disclosure. Journal: Accounting in Europe Pages: 152-189 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.1894347 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1894347 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:152-189 Template-Type: ReDIF-Article 1.0 Author-Name: Voicu-Dan Dragomir Author-X-Name-First: Voicu-Dan Author-X-Name-Last: Dragomir Author-Name: Madalina Dumitru Author-X-Name-First: Madalina Author-X-Name-Last: Dumitru Author-Name: Liliana Feleaga Author-X-Name-First: Liliana Author-X-Name-Last: Feleaga Title: The Predictors of Non-Financial Reporting Quality in Romanian State-Owned Enterprises Abstract: This paper focuses on the predictors of non-financial reporting (NFR) quality by state-owned enterprises (SOEs). The predictors under consideration are the quality of the corporate governance system (assessed through a comprehensive index), state ownership concentration, industry sector characteristics, and company size. Our cross-sectional sample consists of data for 63 state-controlled enterprises in Romania for the financial year 2018. The data were collected by hand, using two new instruments: a content analysis scale for NFR according to the European Directive 2014/95/EU and a corporate governance index for SOEs. We classify Romanian SOEs into two clusters: ‘high disclosure – good governance’ and ‘low disclosure – poor governance,’ for which we present the particularities of NFR and corporate governance. In line with agency theory and stakeholder theory, we show that the NFR quality score is positively correlated with the corporate governance score, company size, environmental impact, monopolistic position, and the state’s strategic interest, but negatively correlated with state ownership concentration. Our results also indicate that an increase in the state’s blockholding will negatively affect the quality of the corporate governance system, and will ultimately decrease the quality of the company’s non-financial disclosures. We conclude that the quality of the governance system is a mediating variable between the state’s ownership concentration and the quality of NFR. Our results are helpful to professionals and policymakers in understanding the path toward the material harmonization of reporting practices at a European level for SOEs and private entities alike. Journal: Accounting in Europe Pages: 110-151 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.2018474 File-URL: http://hdl.handle.net/10.1080/17449480.2021.2018474 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:110-151 Template-Type: ReDIF-Article 1.0 Author-Name: Giovanna Afeltra Author-X-Name-First: Giovanna Author-X-Name-Last: Afeltra Author-Name: Alireza Alerasoul Author-X-Name-First: Alireza Author-X-Name-Last: Alerasoul Author-Name: Berto Usman Author-X-Name-First: Berto Author-X-Name-Last: Usman Title: Board of Directors and Corporate Social Reporting: A Systematic Literature Network Analysis Abstract: Over the last decade, the body of literature on the relationship between corporate governance mechanisms (board composition and its characteristics) and ‘corporate social reporting’ has seen increasing attention from academics. However, no significant studies attempt to systematise the body of literature highlighting the advancement of knowledge in this field. The main objective of this study is to identify the flow of knowledge in this area by applying a chronological approach to the traditional Systematic Literature Review (SLR), which is called Systematic Literature Network Analysis (SLNA). We found 21 papers that constitute the Main Path of knowledge and four clusters from the co-occurrence analysis of authors’ keywords: i) ‘The influencing factors of social disclosure’; ii) ‘Assurance practices and CSR reporting’; iii) ‘Integrated reporting and Sustainability reporting’; iv) ‘The relationship between intellectual capital disclosure and corporate governance’; v) ‘The relevant theories.’ Finally, future avenues of research are suggested. Journal: Accounting in Europe Pages: 48-77 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.1979609 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1979609 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:48-77 Template-Type: ReDIF-Article 1.0 Author-Name: Giovanna Michelon Author-X-Name-First: Giovanna Author-X-Name-Last: Michelon Author-Name: Grzegorz Trojanowski Author-X-Name-First: Grzegorz Author-X-Name-Last: Trojanowski Author-Name: Ruth Sealy Author-X-Name-First: Ruth Author-X-Name-Last: Sealy Title: Narrative Reporting: State of the Art and Future Challenges Abstract: Narrative reporting, both in relation to financial and non-financial information, is increasingly used and often mandated, with significant managerial discretion regarding content. As policy makers consider reporting as a tool for regulation to steer the behaviour of companies towards improving practices and performance upon which they have to disclose, the aim of this paper is to provide the state of the art in the academic literature on narrative reporting and identify future challenges. In order to do so, the paper investigates three questions: (1) How has the quality of narrative reporting been defined? (2) What narrative information is required and used by various stakeholders? (3) What are the real effects of narrative reporting? In answering these three questions, our review also gives implications for both future academic research and policy makers. Journal: Accounting in Europe Pages: 7-47 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.1900582 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1900582 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:7-47 Template-Type: ReDIF-Article 1.0 Author-Name: Charles H. Cho Author-X-Name-First: Charles H. Author-X-Name-Last: Cho Author-Name: Peter Kajüter Author-X-Name-First: Peter Author-X-Name-Last: Kajüter Author-Name: Riccardo Stacchezzini Author-X-Name-First: Riccardo Author-X-Name-Last: Stacchezzini Title: The Future of Corporate Reporting Journal: Accounting in Europe Pages: 1-6 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2022.2033804 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2033804 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:1-6 Template-Type: ReDIF-Article 1.0 Author-Name: Silvia Panfilo Author-X-Name-First: Silvia Author-X-Name-Last: Panfilo Author-Name: Joanna Krasodomska Author-X-Name-First: Joanna Author-X-Name-Last: Krasodomska Title: Climate Change Risk Disclosure in Europe: The Role of Cultural-Cognitive, Regulative, and Normative Factors Abstract: Climate change is a key issue faced by the contemporary world. Through the lens of neoinstitutionalism and the normativity concept, this study examines whether cultural, regulative, and normative dimensions affect the quality of climate change risk disclosures. This paper uses a sample of 653 European companies and measures the quality of their disclosures based on Carbon Disclosure Project (CDP) ratings. The results show that the quality of such disclosures is associated with cultural and normative dimensions, but substantive legitimacy is found to be influenced by all the examined institutional factors. The interactions between the examined cultural and normative dimensions are shown to be (not) important for firms that operated in weaker (stronger) regulative contexts prior to Directive 2014/95/EU. This study provides a better understanding of the challenges related to climate change reporting and the role of institutional differences in the process of achieving normativity in cross-national contexts such as that of the European Union. Journal: Accounting in Europe Pages: 226-253 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2022.2026000 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2026000 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:226-253 Template-Type: ReDIF-Article 1.0 Author-Name: Marisa Agostini Author-X-Name-First: Marisa Author-X-Name-Last: Agostini Author-Name: Ericka Costa Author-X-Name-First: Ericka Author-X-Name-Last: Costa Author-Name: Blerita Korca Author-X-Name-First: Blerita Author-X-Name-Last: Korca Title: Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014/95/EU: Evidence from Italian Listed Companies Abstract: This paper investigates the impact of Directive 2014/95/EU on both the quantity and quality of non-financial disclosure (NFD) and its relationship with corporate financial performance (CFP) in 20 Italian listed companies. The current study considers both the annual reports (AR) and social and environmental reports (SER) released two years prior (2015–2016) and two years after (2017–2018) the Directive’s application. A manual content analysis was conducted and OLS regression analyses were carried out to evaluate the relationship between NFD and CFP, measured by ROA, ROE and Tobin’s Q. The findings show that the Directive affected the quantity of NFD, but not the quality, and that a transfer of information occurred from the different reporting mediums considered. Overall, NFD quality is significant and positively associated with CFP when measured by ROA and ROE, however, the mandatory NFD quality following the Directive does not show a significant relationship with CFP. Journal: Accounting in Europe Pages: 78-109 Issue: 1 Volume: 19 Year: 2022 Month: 01 X-DOI: 10.1080/17449480.2021.1979610 File-URL: http://hdl.handle.net/10.1080/17449480.2021.1979610 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:1:p:78-109 Template-Type: ReDIF-Article 1.0 Author-Name: Cristiano Feliciano Author-X-Name-First: Cristiano Author-X-Name-Last: Feliciano Author-Name: Reiner Quick Author-X-Name-First: Reiner Author-X-Name-Last: Quick Title: Innovative Information Technology in Auditing: Auditors’ Perceptions of Future Importance and Current Auditor Expertise Abstract: Innovative information technology (IT) could help to improve the effectiveness and efficiency of audits. Accordingly, we investigate the future importance, and current auditor expertise, regarding 18 technologies identified from a comprehensive literature review and interviews with Big 4 audit technology experts. We then surveyed German auditors and received 433 usable responses. Respondents perceive most of the analyzed IT as relevant in the next three to five years. Online meeting solutions and data mining have the highest importance rating. By contrast, self-assessed current personal knowledge of most IT is low. Complementary regression analyses reveal that female auditors and Big 4 auditors perceive IT as more important, and younger auditors and Big 4 auditors assess their own knowledge as higher. Comparing importance and knowledge ratings, we find a serious importance-knowledge gap for all considered IT. Intensive educational efforts seem to be essential in order to close this gap. Journal: Accounting in Europe Pages: 311-331 Issue: 2 Volume: 19 Year: 2022 Month: 05 X-DOI: 10.1080/17449480.2022.2046283 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2046283 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:2:p:311-331 Template-Type: ReDIF-Article 1.0 Author-Name: David Delgado-Vaquero Author-X-Name-First: David Author-X-Name-Last: Delgado-Vaquero Author-Name: Jose Morales-Diaz Author-X-Name-First: Jose Author-X-Name-Last: Morales-Diaz Author-Name: Constancio Zamora-Ramírez Author-X-Name-First: Constancio Author-X-Name-Last: Zamora-Ramírez Title: IFRS 16 Incremental Borrowing Rate: Comparability Issues and a Methodology Proposal for Loss Given Default Adjustment Abstract: Under the IFRS 16 capitalization model for lessees, entities should measure both the lease liability and the ‘right of use’ (the lease asset) by discounting future lease payments over the lease term. For the most part, entities are using the Incremental Borrowing Rate (IBR) to perform said discounting. IFRS 16 establishes that the IBR must consider the underlying leased asset as collateral, and therefore the yield to be used should reflect a Loss Given Default (LGD) which may vary according to the estimated recovery rate of the asset, be it machinery, real estate, vehicles, etc. The previous literature has shown that the use of discount rates in IFRS is inconsistent across firms, and also that it is arbitrary. Through an empirical analysis using information from European quoted entities, we find that most companies do not disclose IBR details, thus affecting financial statement comparability. None of them disclose how the IBR is adjusted in order to reflect the LGD. Furthermore, there is a lack of accounting and finance literature analyzing this aspect.Within this context, we propose a model that is able to adjust the standard IBR (obtained from unsecured bonds/loans yields) in order to reflect a recovery rate in line with IFRS principles. The proposed model uses Credit Default Swaps (CDSs) quoted information as a basis for introducing the adjustment to the standard IBR. More precisely, it analyzes the change in the CDS spread in response to changes in the recovery rate, and applies this change to the initial IBR. Journal: Accounting in Europe Pages: 287-310 Issue: 2 Volume: 19 Year: 2022 Month: 05 X-DOI: 10.1080/17449480.2022.2046282 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2046282 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:2:p:287-310 Template-Type: ReDIF-Article 1.0 Author-Name: Ries Breijer Author-X-Name-First: Ries Author-X-Name-Last: Breijer Author-Name: René P. Orij Author-X-Name-First: René P. Author-X-Name-Last: Orij Title: The Comparability of Non-Financial Information: An Exploration of the Impact of the Non-Financial Reporting Directive (NFRD, 2014/95/EU) Abstract: This study explores the impact of the implementation of Directive 2014/95/EU on the comparability of non-financial information across listed European firms, focusing on the usage of non-financial reporting (NFR) frameworks – those developed by the SASB, IIRC, OECD, EFFAS, GRI, UNGC, ISO, AA, and FEE. Using computer-aided text-analysis software (MAXQDA 2022), we analysed the annual reports and stand-alone non-financial (sustainability) reports from listed firms in the STOXX Europe 600 Index covering 2012–2020. The results showed that the implementation of the Directive led to an increase in the use of investor-oriented NFR frameworks (e.g. that of the SASB); frameworks oriented towards a wide range of stakeholders (e.g. GRI) are predominantly used by voluntary adopters. Furthermore, although disclosures by resisters (mandatory adopters) indicate a stronger focus on investors, the disclosure of non-financial information exacerbated information asymmetry for resisters, whereas NFR mitigated information asymmetry for voluntary adopters. Journal: Accounting in Europe Pages: 332-361 Issue: 2 Volume: 19 Year: 2022 Month: 05 X-DOI: 10.1080/17449480.2022.2065645 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2065645 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:2:p:332-361 Template-Type: ReDIF-Article 1.0 Author-Name: Robert K. Larson Author-X-Name-First: Robert K. Author-X-Name-Last: Larson Author-Name: Mark Myring Author-X-Name-First: Mark Author-X-Name-Last: Myring Author-Name: Raf Orens Author-X-Name-First: Raf Author-X-Name-Last: Orens Title: US comment Letter Writing to the IASB and Evolving SEC Views on the Use of IFRS Abstract: This paper investigates drivers of US lobbying on the International Accounting Standards Board (IASB) before, during, and after the Securities and Exchange Commission’s (SEC) active consideration to adopt International Financial Reporting Standards (IFRS). Examining comment letters (CLs) for 148 IASB proposals from 2001 through 2014 finds that while a variety of US stakeholders lobbied, the response rates are low. CL writing in total and by preparers significantly increased during the peak of SEC interest (2007–2010), but afterwards significantly decreased. US writers focus more on key issues rather than responding to proposals earlier in the IASB’s due process. US writers lobbied more about topics also on the Financial Accounting Standards Board (FASB)’s agenda and larger US preparers were more likely to write CLs and write them more frequently than smaller preparers. Overall, response rates are associated with the likelihood that US stakeholders would need to comply with IFRS. Journal: Accounting in Europe Pages: 255-286 Issue: 2 Volume: 19 Year: 2022 Month: 05 X-DOI: 10.1080/17449480.2022.2046281 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2046281 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:2:p:255-286 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2060752_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20220907T060133 git hash: 85d61bd949 Author-Name: Neelam Setia Author-X-Name-First: Neelam Author-X-Name-Last: Setia Author-Name: Subhash Abhayawansa Author-X-Name-First: Subhash Author-X-Name-Last: Abhayawansa Author-Name: Mahesh Joshi Author-X-Name-First: Mahesh Author-X-Name-Last: Joshi Title: In Search of a Wider Corporate Reporting Framework: A Critical Evaluation of the International Integrated Reporting Framework Abstract: We investigate whether the Integrated Reporting () Framework is suitable as an overarching framework to enable organisations to engage with and report on the Sustainable Development Goals (SDGs). The investigation is carried out through a thematic analysis of different stakeholders’ opinions expressed in the 359 responses received by The International Integrated Reporting Council (IIRC) for its 2013 Consultation Draft and the 114 survey responses received for the 2020 Consultation Draft. Based on our findings, we argue that for it to be an ‘umbrella’ framework for non-financial reporting (inclusive of reporting on the SDGs), the < IR > Framework should: (1) encourage engagement with secondary stakeholders whose interests are reflected in the SDGs; (2) use terminology, language and concepts consistent with the sustainability discourse; (3) facilitate explanation of value created for the society and present and future generations; and (4) provide specific guidance to incorporate sustainable development impacts, risks and opportunities. Journal: Accounting in Europe Pages: 423-448 Issue: 3 Volume: 19 Year: 2022 Month: 09 X-DOI: 10.1080/17449480.2022.2060752 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2060752 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:3:p:423-448 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2049327_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20220907T060133 git hash: 85d61bd949 Author-Name: Annika Brasch Author-X-Name-First: Annika Author-X-Name-Last: Brasch Author-Name: Brigitte Eierle Author-X-Name-First: Brigitte Author-X-Name-Last: Eierle Author-Name: Robin Jarvis Author-X-Name-First: Robin Author-X-Name-Last: Jarvis Title: Capitalising or Expensing Development Costs? – Mixed Methods Evidence on the Determinants and Motives of the Accounting Policy in the context of UK Private Companies Abstract: Following calls for further research, this study evaluates the determinants and motives behind private companies’ decision to capitalise development costs by using mixed methods. While prior literature and expert interviews indicate initially that private firms may be motivated opportunistically, subsequent archival analyses show that development costs are capitalised to meet benchmarks and ameliorate poor profitability. Additionally, interview evidence emphasises that debt covenant violation avoidance and increasing merger and acquisition (M&A) values are important drivers for capitalisation, whereas management compensation schemes do not seem to influence their accounting policy. Moreover, findings imply a negative association between firm size and the capitalisation of development costs. Expert interview evidence indicates that smaller companies are more likely to have financing needs, suggesting that capitalisation is employed to signal future economic benefits to investors. Conversely, the motivation for larger companies which are more likely to expense may be grounded on risk avoidance from future impairments. Journal: Accounting in Europe Pages: 363-396 Issue: 3 Volume: 19 Year: 2022 Month: 09 X-DOI: 10.1080/17449480.2022.2049327 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2049327 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:3:p:363-396 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2060753_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20220907T060133 git hash: 85d61bd949 Author-Name: Md Khokan Bepari Author-X-Name-First: Md Khokan Author-X-Name-Last: Bepari Author-Name: Abu Taher Mollik Author-X-Name-First: Abu Taher Author-X-Name-Last: Mollik Author-Name: Shamsun Nahar Author-X-Name-First: Shamsun Author-X-Name-Last: Nahar Author-Name: Mohammad Nazrul Islam Author-X-Name-First: Mohammad Nazrul Author-X-Name-Last: Islam Title: Determinants of Accounts Level and Entity Level Key Audit Matters: Further Evidence Abstract: We examine firm-specific factors (firm life cycle, firm size, complexity, litigation risks, intangible intensity), audit-specific factors (audit firm, audit fee, non-audit fee) and auditor-specific factors (auditor’s experience, specialization, gender and accounting degree), as determinants of the number of KAMs, account-level KAMs (ALKAMs), and entity-level KAMs (ELKAMs) for a sample of Australian firms. Our findings suggest that KAMs’ disclosure varies based on client firm-specific characteristics, audit firm-specific characteristics and audit partners’ characteristics. We find that firms’ life cycle, size, complexity, intangible intensity, audit firm identity, audit fees, auditors’ specialization, experience, gender and accounting degree affect the number and types of KAMs’ disclosure. Our findings negate the concern of stereotyping in KAMs disclosures and suggest that KAMs’ disclosure varies based on many contextual factors. Our findings have important implications for audit firms, corporate boards, investors and regulators. Journal: Accounting in Europe Pages: 397-422 Issue: 3 Volume: 19 Year: 2022 Month: 09 X-DOI: 10.1080/17449480.2022.2060753 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2060753 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:19:y:2022:i:3:p:397-422 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2091466_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Luís Cracel Viana Author-X-Name-First: Luís Cracel Author-X-Name-Last: Viana Author-Name: José António C. Moreira Author-X-Name-First: José António C. Author-X-Name-Last: Moreira Author-Name: Paulo Alves Author-X-Name-First: Paulo Author-X-Name-Last: Alves Title: Disclosure of Information and Transparency in Public-private Partnerships: a Comparative Study Between Portugal and the UK Abstract: This paper studies the adequacy of financial and non-financial disclosures in the government’s consolidated annual report for political accountability of public-private partnerships (PPPs). The empirical evidence from the comparative study shows that neither the UK nor Portugal complies with the information needs of the parliament because several disclosures deemed necessary for the functioning of the political accountability relationship are missing. Furthermore, in the case of Portugal, resource dependence and coercive institutional pressures related to the financial bailout during the sovereign debt crisis justify the increase in the level of disclosures. Such evidence also suggests that a comprehensive external reporting framework for PPPs in their post-procurement phase should be devised. The results present novel evidence concerning public sector accounting comparative studies by focusing on specific transactions and may have important implications for policymakers regarding the design of the disclosures deemed necessary. Journal: Accounting in Europe Pages: 37-63 Issue: 1 Volume: 20 Year: 2023 Month: 01 X-DOI: 10.1080/17449480.2022.2091466 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2091466 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:1:p:37-63 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2130703_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Selina Orthaus Author-X-Name-First: Selina Author-X-Name-Last: Orthaus Author-Name: Daniel Rugilo Author-X-Name-First: Daniel Author-X-Name-Last: Rugilo Title: Revisiting Constituents’ Reflections on the Incorporation of Day-one Losses into IFRS 9 Abstract: IFRS 9 requires the recognition of expected credit losses from the inception of a financial instrument, resulting in so-called day-one losses. The incorporation of day-one losses caused considerable controversy among the IASB members and its constituents. With a focus on the constituents’ positions and reasoning, this study portrays the discussions held in the comment letters received by the IASB during the drafting process. We find that most constituents initially rejected day-one losses as conceptually unsound and/or as inappropriately affecting investors’ and preparers’ decision-making. Despite these continuing concerns, the majority of constituents eventually accepted day-one losses as a pragmatic approximation of expected credit losses in the absence of superior alternatives. Considering the technical and political nature of standard setting, our analysis provides insights into the constituents’ assessment of departures from the Conceptual Framework and the constituents’ views on the standard setters’ responsibilities regarding financial stability after the financial crisis. Journal: Accounting in Europe Pages: 64-90 Issue: 1 Volume: 20 Year: 2023 Month: 01 X-DOI: 10.1080/17449480.2022.2130703 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2130703 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:1:p:64-90 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2091465_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Raúl Barroso Author-X-Name-First: Raúl Author-X-Name-Last: Barroso Author-Name: Chiraz Ben Ali Author-X-Name-First: Chiraz Author-X-Name-Last: Ben Ali Author-Name: Cédric Lesage Author-X-Name-First: Cédric Author-X-Name-Last: Lesage Author-Name: Daniel Oyon Author-X-Name-First: Daniel Author-X-Name-Last: Oyon Title: Blockholder Heterogeneity and Audit Fees: Does Private Information Matter? Abstract: We analyze the impact of Small Blockholders’ (SBH – with 5% to 10% of voting rights) heterogeneity and their access to private information on the demand for audit services. By promoting enhanced audit services, we expect SBH to have a moderating effect on the relation between Large Blockholders (LBH – more than 10% of voting rights) and audit fees in a context of low shareholder protection. Drawn on Swiss public firm data over the 2002–2019 period, our results show that the presence of SBH flattens the concave relation between ownership concentration and audit fees found in prior studies. This moderating effect is mainly driven by the uninformed SBH, who given their lower – compared with informed SBH – access to private channels of information, are more likely to rely on audited public financial statements. Our findings contribute to the literature on the role of SBH in the company’s corporate governance. Journal: Accounting in Europe Pages: 1-36 Issue: 1 Volume: 20 Year: 2023 Month: 01 X-DOI: 10.1080/17449480.2022.2091465 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2091465 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:1:p:1-36 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2149345_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Tami Dinh Author-X-Name-First: Tami Author-X-Name-Last: Dinh Author-Name: Anna Husmann Author-X-Name-First: Anna Author-X-Name-Last: Husmann Author-Name: Gaia Melloni Author-X-Name-First: Gaia Author-X-Name-Last: Melloni Title: Corporate Sustainability Reporting in Europe: A Scoping Review Abstract: This paper provides a scoping review of European sustainability reporting studies. Previous sustainability studies do not offer a comprehensive discussion of features key to the European setting. Despite their important role in the European economy, research on small and medium-sized enterprises (SMEs) and financial institutions (i.e. insurers and banks) is limited. Furthermore, regions in southern and particularly eastern Europe, which are critical given regulators’ objectives for European Union-wide and global sustainability standards, are neglected. Finally, studies on non-financial effects of sustainability reporting are also limited, and only a few studies differentiate between stakeholder- and shareholder-oriented countries. This is needed for a holistic view on sustainability beyond financial performance. Based on material issues identified for the European context, our study provides a research agenda based on comprehensive and rigorous scientific evidence on the state of the art of sustainability research in Europe. Journal: Accounting in Europe Pages: 91-119 Issue: 1 Volume: 20 Year: 2023 Month: 01 X-DOI: 10.1080/17449480.2022.2149345 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2149345 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:1:p:91-119 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2150979_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Abubakar Ahmed Author-X-Name-First: Abubakar Author-X-Name-Last: Ahmed Author-Name: Mutalib Anifowose Author-X-Name-First: Mutalib Author-X-Name-Last: Anifowose Author-Name: Suleiman Salami Author-X-Name-First: Suleiman Author-X-Name-Last: Salami Author-Name: Nuhu Abubakar Author-X-Name-First: Nuhu Author-X-Name-Last: Abubakar Title: Multiple Capitals Disclosure in European Companies’ Integrated Reports: The Role of Organisational Complexity Abstract: This paper examines the association between organisational complexity and the extent of multiple capital disclosure in European companies’ integrated reports. The study uses content analysis to collect data from 81 European companies that adopted the integrated reporting framework for the period 2014–2020. We proxy the extent of multiple capital disclosure by an aggregate score of natural, human, social, intellectual, manufactured, and financial capital disclosure. We analyse two forms of organisational complexity: industrial (related to the different product segments) and geographical (linked with conduction operations beyond the domestic market). The results show that industrial complexity has a significant positive association with the extent of multiple capitals disclosure, whereas geographical complexity has an insignificant positive relationship. The study concludes that organisational complexity explains the variability in the extent of multiple capitals disclosure. Journal: Accounting in Europe Pages: 120-138 Issue: 1 Volume: 20 Year: 2023 Month: 01 X-DOI: 10.1080/17449480.2022.2150979 File-URL: http://hdl.handle.net/10.1080/17449480.2022.2150979 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:1:p:120-138 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2174444_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Marco Maria Mattei Author-X-Name-First: Marco Maria Author-X-Name-Last: Mattei Author-Name: Matteo Merlo Author-X-Name-First: Matteo Author-X-Name-Last: Merlo Author-Name: Eleonora Monaco Author-X-Name-First: Eleonora Author-X-Name-Last: Monaco Title: The Italian depreciation suspension policy during the COVID-19 pandemic: consequences on private firms’ borrowing capacity Abstract: We investigate the consequences of adopting a new accrual-based relief mechanism on private firms’ borrowing capacity. During the COVID-19 pandemic, the Italian government implemented a temporary change in accounting rules that allowed firms to suspend up to the entire amount of their depreciation and amortisation charges. Using a sample of Italian firms from 2018 to 2021 and a difference-in-differences model, we show that the depreciation and amortisation suspension policy (DASP) adopters, compared to non-adopters, access larger loans and negotiate a lower cost of debt than in the pre-DASP period. Our results are robust to additional tests for potential endogeneity and confounding factors such as earnings management and the adoption of other accounting-based relief mechanisms. We provide evidence that accrual-based relief mechanisms have real economic effects and are effective measures to support firms in managing a systemic shock. Journal: Accounting in Europe Pages: 166-193 Issue: 2 Volume: 20 Year: 2023 Month: 05 X-DOI: 10.1080/17449480.2023.2174444 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2174444 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:2:p:166-193 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2192356_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Zakir Akhand Author-X-Name-First: Zakir Author-X-Name-Last: Akhand Author-Name: Amin Mawani Author-X-Name-First: Amin Author-X-Name-Last: Mawani Title: Arm's Length Principle vs. Formulary Apportionment in BEPS Action 13: Stakeholders’ Perspectives Abstract: This paper analyses comment-letter lobbying by different stakeholders to influence OECD’s documentation rules on transfer pricing within the Base Erosion and Profit Shifting (BEPS) project. Using a content analysis of stakeholders’ comments to a discussion draft on documentation requirements of Action 13 of OECD’s BEPS policies, we offer some evidence that professional accounting firms may have viewed the new documentation requirements as a stealth paradigm shift away from the arm’s length principle (ALP) to formulary allocation (FA). Our analysis suggests that other stakeholders from academia and civil society were sceptical of the comments expressed by the professional tax firms, regarding them as a means to resist changes in transfer pricing documentation. We suggest that professional accounting firms’ comments may have represented implicit lobbying against changes to the ALP regime that may have been considered beneficial to taxpayers in reducing their aggregate tax burden despite its implementation and rule complexity. Journal: Accounting in Europe Pages: 225-243 Issue: 2 Volume: 20 Year: 2023 Month: 05 X-DOI: 10.1080/17449480.2023.2192356 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2192356 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:2:p:225-243 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2205867_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Philipp Jahn Author-X-Name-First: Philipp Author-X-Name-Last: Jahn Author-Name: Thomas Loy Author-X-Name-First: Thomas Author-X-Name-Last: Loy Title: Audit in Europe – A Comparison of Access Requirements into the Audit Profession Across the European Union Abstract: Within the EU, various measures have been taken to harmonize access to the audit profession. Nevertheless, only minimum access requirements are defined by EU regulation. Our results show considerable remaining differences between the member states. They are the basis for an Access Requirements Index (ARI) which makes it possible to easily assess and compare requirements placed on prospective auditors. In further analyzes, we show that the EU member states form five clusters based on the underlying parameters of the index. Our paper provides a basis for future research on possible consequences of these differences and gives an overview to regulators and the professions in the EU about the status of harmonization of access requirements. Journal: Accounting in Europe Pages: 244-271 Issue: 2 Volume: 20 Year: 2023 Month: 05 X-DOI: 10.1080/17449480.2023.2205867 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2205867 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:2:p:244-271 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2189016_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Hervé Stolowy Author-X-Name-First: Hervé Author-X-Name-Last: Stolowy Author-Name: Luc Paugam Author-X-Name-First: Luc Author-X-Name-Last: Paugam Title: Sustainability Reporting: Is Convergence Possible? Abstract: In this essay, we discuss the factors influencing the likelihood of convergence in corporate sustainability reporting. We identify several factors that negatively influence the probability of convergence in the short term. The first factor is the heterogeneity of concepts and definitions surrounding sustainability (e.g. ESG, CSR). This heterogeneity of definitions is pervasive at three levels: (1) across organizations claiming legitimacy in sustainability reporting standard-setting, (2) within standard-setting organizations over time, and (3) across firms reporting about their activities. A second factor is the large number of organizations claiming legitimacy in sustainability reporting. A third factor is related to a diversity of reporting requirements among three influential international standard setters (i.e. EFRAG, ISSB, SEC), leading to various corporate reporting choices. A fourth factor is the diversity in the objectives of standard-setting organizations. Overall, we believe that due to these sources of diversity, the probability of convergence in sustainability reporting appears limited, at least in the short term, although we identify progress in carbon emissions reporting. Journal: Accounting in Europe Pages: 139-165 Issue: 2 Volume: 20 Year: 2023 Month: 05 X-DOI: 10.1080/17449480.2023.2189016 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2189016 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:2:p:139-165 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2192235_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Frédéric Pourtier Author-X-Name-First: Frédéric Author-X-Name-Last: Pourtier Author-Name: Frédérique Bardinet-Evraert Author-X-Name-First: Frédérique Author-X-Name-Last: Bardinet-Evraert Author-Name: Veronique Darmendrail Author-X-Name-First: Veronique Author-X-Name-Last: Darmendrail Title: The Value Relevance of Accounting Numbers in Presence of the Equity Method Before and After IFRS 11: Evidence from France Abstract: This article studies the effects of IFRS 11 on the value relevance of accounting numbers (VRAN) in France. In 2014, IFRS 11 made the equity method (EM) mandatory to account for joint ventures (JVs) and disallowed proportionate consolidation, the method previously preferred by French groups. Panel method regressions are used to examine the evolution of value relevance in listed groups’ financial statements over a long period (2007–2020). Generalization of the EM reallocates the VRAN, and post-IFRS 11 EM-related numbers are significantly and negatively linked to market value, raising questions about their faithfulness. These results concern all groups using the EM, whatever method they previously used for JVs. This study also looks at the standard-setters’ proposed integral/non-integral classification of net income from JVs and associates, which is found to be non-value relevant. These results have implications at standard-setting level for improving the quality of financial reporting, and for investors. Journal: Accounting in Europe Pages: 194-224 Issue: 2 Volume: 20 Year: 2023 Month: 05 X-DOI: 10.1080/17449480.2023.2192235 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2192235 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:2:p:194-224 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2237056_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Maria Bengtsson Author-X-Name-First: Maria Author-X-Name-Last: Bengtsson Author-Name: Daniela Argento Author-X-Name-First: Daniela Author-X-Name-Last: Argento Title: International Accounting Convergence and Divergence: Towards a Framework for Understanding De Jure Adoption of IFRS Abstract: By bridging the two main approaches examining de jure adoption of IFRS, namely, convergence and divergence studies, we provide a framework that more fully captures the totality, dynamics, and complexity of voluntary adoption of IFRS by country. The framework offers an understanding of accounting regulators’ efforts to balance between pressure to adopt IFRS and national specific conditions that may conflict with IFRS requirements. The suggested framework depicts four propositions which are built on four institutional dimensions: the degree of IFRS diffusion, national accounting system compatibility with IFRS, country dependence on external financing, and accounting regulator’s international networking. These four propositions jointly predict national adoption level of IFRS, ranging from non-adoption to partial adoption, and to full adoption. The framework assumes that the current IFRS adoption status by country is not static and may change over time. The voluntary adoption of IFRS standards by country is understood as the result of tradeoffs among multiple factors. In doing so, the developed framework solves a theoretical dichotomy in IFRS studies: the tendency of using institutional isomorphism to examine convergence versus accounting classification to understand divergence. Journal: Accounting in Europe Pages: 370-392 Issue: 3 Volume: 20 Year: 2023 Month: 09 X-DOI: 10.1080/17449480.2023.2237056 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2237056 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:3:p:370-392 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2213249_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Alessandro Mura Author-X-Name-First: Alessandro Author-X-Name-Last: Mura Title: Reconciling Competing Reporting Objectives Through Deferred Tax Accounts: Evidence on Private Italian Firms Abstract: This paper contributes to the growing literature on earnings management in private firms by focusing on deferred taxes. This accounting treatment requires sophisticated use of accruals that provides the chance to manage earnings and net assets without affecting the tax payable. We argue that in a setting with high book-tax conformity, the small room that allegedly exists to recognise deferred taxes remains a comfortable avenue to reach reporting objectives that a tax-minimisation strategy may preclude. We use a sample of private firms operating in a credit- and tax-driven environment such as Italy to test this expectation. Our results show that private firms use deferred taxes to extract multiple financial reporting benefits that may facilitate debt contracting: smoothing earnings over time, meeting/beating historical earnings, avoiding reporting accounting losses, and managing leverage. Tax loss carryforwards are the source of deferred tax assets where the exercise of discretion becomes more critical. Journal: Accounting in Europe Pages: 304-338 Issue: 3 Volume: 20 Year: 2023 Month: 09 X-DOI: 10.1080/17449480.2023.2213249 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2213249 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:3:p:304-338 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2206522_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Willem Buijink Author-X-Name-First: Willem Author-X-Name-Last: Buijink Title: A Commentary on Who ‘Owns’ the University Accounting Curriculum?: And on Why That ‘Ownership’ Matters Abstract: The issue raised in this commentary is: who determines, who owns, the accounting curriculum in universities, and does it matter who does? The question has a clear answer. But the answer is not what you would expect it to be. The accounting professoriate does not ‘own’ the accounting curriculum. Professional accountants and auditor organizations, the accounting profession, as well as accounting and auditing regulators and oversight bodies do. The problem with the domination of the accounting profession and regulators of the university accounting curriculum is that it prevents the professional quality of accountants and auditors from reaching its full potential. I argue in this commentary that this will only happen when the accounting professoriate takes full charge of curriculum design. This commentary is a call for that to happen. Journal: Accounting in Europe Pages: 273-280 Issue: 3 Volume: 20 Year: 2023 Month: 09 X-DOI: 10.1080/17449480.2023.2206522 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2206522 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:3:p:273-280 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2213242_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Karol Marek Klimczak Author-X-Name-First: Karol Marek Author-X-Name-Last: Klimczak Author-Name: Dominika Hadro Author-X-Name-First: Dominika Author-X-Name-Last: Hadro Author-Name: Marcel Meyer Author-X-Name-First: Marcel Author-X-Name-Last: Meyer Title: Executive communication with stakeholders on sustainability: the case of Poland Abstract: Sustainability reporting is rapidly developing in the European Union – from voluntary Corporate Social Responsibility (CSR) disclosure over to mandatory non-financial reporting (NFR), then over to Economic, Social and Governance (ESG) – with the ambition of becoming as important as financial reporting. This paper investigates whether executives act as change agents in this process by setting a tone at the top, and how their communication changes as time progresses. We use methods from computational corpus linguistics to analyze commentaries by companies listed at the Warsaw Stock Exchange between 2017 and 2021. Results show how top managers are not aligned with the sustainability transition. Their commentaries are bluntly positive and lack performance information. Over time, change and environmental challenges gain attention. In sum, executives appear to respond primarily to investor needs. While showing respect to stakeholders, they avoid setting goals and reporting effects. Effective regulation may bring about the necessary change. Journal: Accounting in Europe Pages: 281-303 Issue: 3 Volume: 20 Year: 2023 Month: 09 X-DOI: 10.1080/17449480.2023.2213242 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2213242 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:3:p:281-303 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2231964_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20230119T200553 git hash: 724830af20 Author-Name: Cédric Poretti Author-X-Name-First: Cédric Author-X-Name-Last: Poretti Author-Name: Tiphaine Jérôme Author-X-Name-First: Tiphaine Author-X-Name-Last: Jérôme Author-Name: Carl Brousseau Author-X-Name-First: Carl Author-X-Name-Last: Brousseau Title: Family identification and earnings management in listed firms Abstract: In this paper, we investigate the earnings management behavior of listed family firms holding the name of the family (eponymous FF). Specifically, we use a Swiss sample of 1,544 firm-year observations from 2006 to 2018 to examine the association of eponymous FF with accrual-based earnings management in general, and identify circumstances where this association does not hold. First, we find that, on average, eponymous FF exhibit less earnings management than non-FF. Second, we exploit a Swiss-specific option to voluntarily turn away from IFRS to local GAAP. Using a difference-in-differences approach, we find that eponymous FF exhibit higher levels of earnings management immediately after the switch. Finally, we show that eponymous FF exhibit higher earnings management when the family is directly involved in the board of directors or the managing board. Our findings provide a more nuanced understanding of the effects of family identification on earnings management incentives in listed firms. Journal: Accounting in Europe Pages: 339-369 Issue: 3 Volume: 20 Year: 2023 Month: 09 X-DOI: 10.1080/17449480.2023.2231964 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2231964 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:20:y:2023:i:3:p:339-369 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2218398_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20240209T083504 git hash: db97ba8e3a Author-Name: Alfred Wagenhofer Author-X-Name-First: Alfred Author-X-Name-Last: Wagenhofer Title: Sustainability Reporting: A Financial Reporting Perspective Abstract: This paper examines incentive effects of sustainability reporting, based on proposals for mandatory sustainability reporting standards in the EU, the US, and the IFRS Foundation, and highlights conceptual differences between sustainability and financial reporting. Sustainability reporting is an instrument of transparency regulation intended to influence management decisions. It requires disclosure of a large set of data points but does not provide aggregate measures. It is production-oriented and does not include accruals. It expands reporting to include disclosure of long-term policies and targets, and of information of firms in the value chain. Consequently, sustainability reporting is not very useful for tracking sustainability performance and for comparisons across firms. Overall, it would benefit from applying more generally accepted accounting concepts. Journal: Accounting in Europe Pages: 1-13 Issue: 1 Volume: 21 Year: 2024 Month: 01 X-DOI: 10.1080/17449480.2023.2218398 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2218398 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:1-13 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2256059_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20240209T083504 git hash: db97ba8e3a Author-Name: Isabell Keller Author-X-Name-First: Isabell Author-X-Name-Last: Keller Author-Name: Brigitte Eierle Author-X-Name-First: Brigitte Author-X-Name-Last: Eierle Author-Name: Sven Hartlieb Author-X-Name-First: Sven Author-X-Name-Last: Hartlieb Title: Auditors’ Carbon Risk Consideration under the EU Emission Trading System Abstract: This paper addresses the effects of clients’ carbon risk on audit pricing. Using data from 438 EU companies for the period 2013–2019, we find a positive relationship between carbon risk (measured by the level of carbon emissions) and audit fees. Furthermore, we find that participation in the European Union’s Emission Trading System, a limited market and regulation scheme to mitigate special industries’ Greenhouse Gas emissions, strengthens the positive relationship between carbon risk and audit fees. Insights from additional tests indicate that auditors price carbon risk particularly for large clients that are under greater public scrutiny and that the increase in fees rather stems from a risk premium charged by the auditor than higher audit effort. With interest in climate change developing rapidly across society, practice and research combined with the increasing importance of reducing carbon risk, our findings are timely and should thus appeal to a wide variety of recipients. Journal: Accounting in Europe Pages: 14-43 Issue: 1 Volume: 21 Year: 2024 Month: 01 X-DOI: 10.1080/17449480.2023.2256059 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2256059 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:14-43 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2290735_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20240209T083504 git hash: db97ba8e3a Author-Name: Sameh Kobbi-Fakhfakh Author-X-Name-First: Sameh Author-X-Name-Last: Kobbi-Fakhfakh Author-Name: Fatma Driss Author-X-Name-First: Fatma Author-X-Name-Last: Driss Title: The effect of mandatory extraction payment disclosures on corporate tax avoidance: evidence from the United Kingdom Abstract: The study investigates whether mandatory extraction payment disclosures (EPD), a policy intervention involving Country-by-Country Reporting (CbCR) in extractive industries, affects corporate tax avoidance. Based on a sample of firms listed on the London Stock Exchange over the period from 2010 to 2021, and using the Difference-in-Differences (DiD) model including firm and year fixed effects, results showed a decline in the level of tax avoidance of British extractive firms post-EPD requirement implementation, relative to U.S. extractive/British manufacturing firms not subject to such a requirement. The findings highlight one of the unstated positive consequences of the EPD regulation implementation including discouraging tax avoidance. They should be informative to tax authorities and civil society as they continue to refine existing disclosure requirements and combat tax avoidance. They also support the U.S. Government Accountability Office (GAO)’s (2008) and Organization for Economic Cooperation and Development (OECD)’s (2015) arguments that CbCR facilitates understanding of corporate tax practices. Journal: Accounting in Europe Pages: 44-67 Issue: 1 Volume: 21 Year: 2024 Month: 01 X-DOI: 10.1080/17449480.2023.2290735 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2290735 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:44-67 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2241871_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20240209T083504 git hash: db97ba8e3a Author-Name: Frederik Verplancke Author-X-Name-First: Frederik Author-X-Name-Last: Verplancke Author-Name: Stefanie De Bruyckere Author-X-Name-First: Stefanie Author-X-Name-Last: De Bruyckere Author-Name: Patricia Everaert Author-X-Name-First: Patricia Author-X-Name-Last: Everaert Author-Name: Carine Coppens Author-X-Name-First: Carine Author-X-Name-Last: Coppens Author-Name: EVA BLONDEEL Author-X-Name-First: EVA Author-X-Name-Last: BLONDEEL Title: Small and Medium-Sized Accounting Practices (SMPs): Explaining Financial Performance based on Human Capital and Organisational Resources Abstract: Small- and medium-sized accounting practices (SMPs) offer clients – small and medium-sized entities – support to comply with statutory services (financial statements, tax file preparation) and provide customised business advice. This paper investigates differences in SMP’s financial performance. A survey was sent to Belgian heads of SMPs, asking about personal characteristics regarding education and experience (representing human capital resources), firm size, service types provided, cooperation, and communication (representing organisational capital resources). The findings show that additional specialisation degrees, more experience, and more continuing professional development are linked with higher sales per employee. However, the advantage of additional specialisation degrees diminishes as experience increases. Cooperating with other service providers and using the phone as preferred communication method were also linked to higher financial performance. Finally, male-headed SMPs had higher sales per employee than female-headed ones. Female accountants focused more on their educational role, spending more time explaining the figures to clients. Journal: Accounting in Europe Pages: 68-100 Issue: 1 Volume: 21 Year: 2024 Month: 01 X-DOI: 10.1080/17449480.2023.2241871 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2241871 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:68-100 Template-Type: ReDIF-Article 1.0 # input file: RAIE_A_2251996_J.xml processed with: repec_from_jats12.xsl darts-xml-transformations-20240209T083504 git hash: db97ba8e3a Author-Name: Abiot Tessema Author-X-Name-First: Abiot Author-X-Name-Last: Tessema Title: Does mandatory recognition of derivatives and hedging activities influence investors’ uncertainty and diversity of opinion? The moderating role of product market competition Abstract: The International Accounting Standard No. 39 and the Statement of Financial Accounting Standard No. 133 were issued to address investors’ concerns regarding the reporting requirements for derivatives and hedging activities. I examine the influence of derivatives recognition, as required by SFAS 133, on investors’ uncertainty and diversity of opinion about the cash flow implications of underlying market rate changes. Using a sample of firms included in the S&P 500 Index, I find a decline in investors’ uncertainty and diversity of opinion after the adoption of SFAS 133 for users of derivatives. Furthermore, I find that investors’ uncertainty and diversity of opinion after the adoption of SFAS 133 is higher for users of derivatives operating in highly competitive industries compared to in less competitive industries. Overall, the study highlights the importance of considering a firm’s competitive environment when implementing recognition practices related to derivatives and hedging activities. Journal: Accounting in Europe Pages: 101-121 Issue: 1 Volume: 21 Year: 2024 Month: 01 X-DOI: 10.1080/17449480.2023.2251996 File-URL: http://hdl.handle.net/10.1080/17449480.2023.2251996 File-Format: text/html File-Restriction: Access to full text is restricted to subscribers. Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:101-121