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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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Handle: RePEc:taf:acceur:v:19:y:2022:i:2:p:255-286
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# 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
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Handle: RePEc:taf:acceur:v:19:y:2022:i:3:p:423-448
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# 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
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Handle: RePEc:taf:acceur:v:19:y:2022:i:3:p:363-396
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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# 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
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Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:44-67
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# 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
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# 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
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Handle: RePEc:taf:acceur:v:21:y:2024:i:1:p:101-121