To read this content please select one of the options below:

Do IFRS provide better information about intangibles in Europe?

Jean‐Michel Sahut (Geneva School of Business Administration, University of Applied Sciences, Geneva, Switzerland)
Sandrine Boulerne (University François Rabelais & ESCEM, Tours, France)
Frédéric Teulon (IPAG Business School, Paris, France)

Review of Accounting and Finance

ISSN: 1475-7702

Article publication date: 9 August 2011




The purpose of this paper is to study the information content of intangible assets under IAS/IFRS when compared to local GAAP for European listed companies.


The paper employs multivariate regression models for a sample of 1,855 European listed firms in a six‐year period, from 2002 to 2004 in local GAAP and from 2005 to 2007 in IAS/IFRS to investigate the empirical relationships between market value of European firms and book value of their intangible assets.


The results suggest that the book value of other intangible assets of European listed firms is higher under IFRS than local GAAP and has more informative value for explaining the price of the share and stock market returns. European investors, however, consider the financial information conveyed by capitalized goodwill to be less relevant under IFRS than with local GAAP. Thus, identified intangible assets capitalized on European company balance sheets provide more value‐relevant information for shareholders than unidentified intangible assets that have been transferred into goodwill, with the exception of Italian and Finnish investors.


The paper adds to the existing literature on IFRS by documenting the association between the market value of European listed firms and the book value of their goodwill and other intangibles assets. The study complements prior studies by demonstrating that country differences persist despite the use of common accounting standards and that legal and regulatory country characteristics as well as market forces could still have a significant impact on the value relevance of accounting data.



Sahut, J., Boulerne, S. and Teulon, F. (2011), "Do IFRS provide better information about intangibles in Europe?", Review of Accounting and Finance, Vol. 10 No. 3, pp. 267-290.



Emerald Group Publishing Limited

Copyright © 2011, Emerald Group Publishing Limited

Related articles