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Labour cost disclosures: have IFRSs made a difference?

Sang Ho Kim (RMIT University, Melbourne, Australia)
Dennis Taylor (RMIT University, Melbourne, Australia)

Journal of Human Resource Costing & Accounting

ISSN: 1401-338X

Article publication date: 28 June 2011




This paper aims to investigate changes in corporate disclosures of labour‐related costs in financial statements arising from a change in the accounting regime from generally accepted accounting principles (GAAPs) to international financial reporting standards (IFRSs) in Australia.


An archival empirical approach is taken. Data are sampled for 160 listed companies in Australia over seven years covering Australian GAAPs (2003‐2005) and Australian IFRSs (2006‐2009) periods. To measure disclosures, a classification and count is made of line items for labour‐related costs found on the face of and in the notes to financial statements. These disclosures are analysed against firm‐specific characteristics and industry categories.


Results reveal companies disclosing “total labour costs” rose from about 60‐85 per cent, and the discretionary disaggregation of “total labour costs” became more prevalent. Companies providing disaggregated information in the post‐IFRSs period are characterized by lower total assets, lower sales and lower labour costs. Their return on equity and labour intensity are not found to be differentiating characteristics. Reasons for these phenomena are addressed.


Previous studies have not analysed the effect of IFRSs adoption on disclosures of labour‐related information. This study provides new evidence about the types of firms that have responded to IFRSs with new or enhanced labour‐related financial disclosures. It points to new opportunities for research and financial analysis from the enhanced availability of corporate‐level labour cost data.



Ho Kim, S. and Taylor, D. (2011), "Labour cost disclosures: have IFRSs made a difference?", Journal of Human Resource Costing & Accounting, Vol. 15 No. 2, pp. 127-146.



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Copyright © 2011, Emerald Group Publishing Limited

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