Search results

The current study investigates the impact of directors' attributes on the extent of compliance with International Financial Reporting Standards (IFRS) fair value disclosure requirements. The attributes investigated include directors' human capital (accounting qualification) and social capital (political association), directors' share ownership and the power distance between the chief executive officer (CEO) and the rest of the board members.

The study uses disclosure analysis to measure the extent of compliance with the fair value disclosure requirements of IFRS. Ordinary least squares (OLS) regression is used to test the relationship between the disclosure score and directors' attributes. Data were collected from the annual reports and websites of the sample companies.

Contrary to conventional belief, this study's findings suggest that directors' social capital and the power distance between the CEO and the rest of the board act as more powerful factors than directors' human capital in explaining corporate mandatory disclosure. Specifically, the results indicate that powerful actors form a dominant coalition and co-opt influential constituents from the institutional domain to neutralize the effect of legal coercion and the accounting expertise of board members and Big Four audit firms on the extent of compliance with institutional (fair value) rules.

This study utilizes Oliver's (1991) framework of strategic response to institutional processes in the Bangladeshi context. Although the study provides new insights into corporate disclosure practices, findings are not generalizable due to different institutional settings in different countries. Therefore, future studies could replicate the approach in different institutional settings.

The findings of this study will be of interest to the International Accounting Standards Board (IASB) as it focuses on a developing country that has adopted IFRS 13 and other fair value-related standards relatively recently.

The disclosure analysis contained in this study represents the first comprehensive analysis of the extent of compliance with the fair value disclosure requirements of IFRS. Furthermore, this study considers the impact of directors' social capital and finds that it is a more powerful determinant of the extent of compliance with IFRS as compared to human capital.

The paper aims to provide empirical evidence of the impact of IFRS adoption on the value relevance of accounting information in the emerging market of Saudi Arabia.

The sample consists of 98 non-financial listed firms operating in Saudi Arabia from 2014 to 2019, representing the years before and after IFRS adoption. The authors apply basic and extended price models to examine the value relevance of select accounting figures.

The authors findings provide evidence that accounting information is, generally, value relevant to the Saudi Arabian capital market. However, mixed results exist for particular accounting variables. Both earnings and cash flows are value-relevant in the period before and after IFRS adoption; equity is only relevant in the post-adoption period. Furthermore, IFRS adoption also increases the explanatory power of earnings. An increase in the value relevance of earnings and equity hurts the value relevance of cash flows. The effects are moderated by leverage and dividend policy.

The authors contribute to the ongoing discussion of the economic effects of IFRS adoption in emerging markets. The empirical findings show that initial concerns about IFRS adoption, as reflected by the negative coefficient within the regression analysis, are mitigated once the usefulness of the individual accounting variables published in financial statements is investigated.

This article aims to identify and review existing studies on the adoption and compliance of International Financial Reporting Standards (IFRS) in Africa.

The methodology involves a sole focus on studies conducted with an African sample, using a bibliometric method and data from the Web of Science (WoS) database. Visualizations from VOSViewer and Biblioshiny software are employed to identify the dominant authors, journals and countries contributing to research in the region.

The findings reveal existing collaborations among authors in the field. However, the study emphasizes the need for additional research to enhance the intellectual structure of the research domain, as the majority of related documents are concentrated within twenty articles with at least one citation.

The practical implications underscore the importance of collaboration in practice, emphasizing the need for cooperation among corporations, experts and regulatory agencies involved in IFRS adoption and compliance in Africa. By fostering collaborative efforts and knowledge-sharing among corporations, experts and regulatory agencies, practitioners can enhance their understanding, streamline implementation processes and improve compliance methods.

This review is one of the few to explicitly conduct a bibliometric review of IFRS adoption and compliance studies in Africa, providing a foundation for future research to determine the current direction of IFRS studies in this region.

The purpose of this study is to identify, recap and evaluate the state-of-the-art linkage between International Financial Reporting Standards (IFRS) and earnings management (EM).

A bibliometric analysis of 249 publications from the Web of Science (WoS) database was carried out, employing both the techniques of performance analysis and science mapping and the Bibliometrix R and VOSviewer tools.

The results of the performance analysis suggest that the publication and citation trends of the interplay of the IFRS and EM fields show an upward trend over time that most of the influential institutions emanate from the US and a significant percentage of articles published in this field emanate from high-quality journals. Science mapping via co-authorship analysis elucidates that more collaborative efforts among authors are needed in the future in this field. Bibliographic coupling analysis bifurcates the studies into six clusters and reveals the major themes and their evolution. Co-word analysis unfolds emerging trends that could be further explored, thus becoming possible future research avenues.

To the best of the authors' knowledge, no other study has attempted a bibliometric analysis of research on the relationship between IFRS and EM. This article fills this research gap and makes its contribution to the scientific community by presenting recent developments in this body of knowledge and suggesting future research avenues.

This study aims to examine the impact of national culture on classification shifting in Eastern European Member States of EU Eastern European countries (EEU) vis-à-vis the Western Member States of EU (WEU). The EEU provides a unique sample to study the quality of financial reporting that the authors measure with classification shifting given that for more than five decades they were following the model of a centrally planned economy, where market-based financial reporting was absent. Yet, the EEU transitioned to a market-based economy and completed its accession to the EU.

This study uses a panel data set of firm year observations from 1996 and 2020 that covers the full transition of EEU. This empirical analysis is based on fixed effects panel regression analysis where the authors report a plethora of identifications.

This study finds classification shifting in the EEU countries since their transition to the market-based economy, though they have no long record of market-based financial reporting. This study also notices that cultural factors are associated with classification shifting across all Member States of the EU. This study further examines the impact of interactions between cultural characteristics and special items and reveal variability between WEU and EEU. As part of the robustness analysis, this study also tests the impact of culture on real earnings management measures for both WEU vs EEU, confirming the variability of the impact of culture on earnings management.

Future research could explore the role of religion differences in WEU vis-à-vis EEU states, as they are also subject to cultural differences.

The findings are important for regulators, external monitors and investors, as they show that cultural factors affect earnings management with some variability across countries in the EU, and they should be acknowledged in policymaking.

The findings show that cultural differences between EEU and the “old” Member States of the EU could explain classification shifting.

To the best of the authors’ knowledge, this is the first study that sheds light on the impact of national culture on classification shifting in EEU of EU vis-à-vis the “old” WEU of EU.

This study aims to investigate the effect of mandatory international financial reporting standards (IFRS) adoption on the risk disclosure quality by listed European insurers.

The study used a content analysis of the annual reports and consolidated accounts of 13 insurance companies listed in the European market between 2002 and 2007 based on two regulatory frameworks, Solvency and IFRS.

The results showed a significant effect of the mandatory adoption of IFRS and a clear improvement in the quality of risk disclosure. Moreover, risk disclosure is positively associated with the size of the company.

The authors can consider the relatively limited size of the sample as a limitation of this study. Moreover, the manual content analysis used to be considered subjective.

The findings of this study provide useful insights to professional and regulatory bodies about the consequences of IFRS adoption to enhance transparency and particularly risk disclosure.

The research contributes to the existing literature. First, the authors have shown that companies are improving in the quality of risk disclosure even before 2005. Second, the authors have shown that the year 2005 is distinguished by a marked improvement in disclosure trends, with companies aligning themselves with coercive and mimetic regulatory forces. Third, the authors highlight the significant effect of mandatory IFRS adoption even in highly regulated industries, such as the insurance industry.

The purpose of this paper is to compare earnings management (EM) and capital management (CM) by European banks before and after the adoption of IFRS 9. After IFRS 9, banks have more discretion in recognizing loan-loss provisions than before IFRS 9. Hence, after IFRS 9, banks could use EM and CM to a greater extent.

This paper analyzes a sample of European banks and uses regression analysis. First, this paper examines whether EM and CM changed after IFRS 9 was adopted. Next, this study examines whether any changes in EM and CM under IFRS 9 depend on regulatory quality (RQ) in the country where banks are located.

This paper has three results. First, after IFRS 9, EM increased relative to before IFRS 9. Second, after IFRS 9, CM increased relative to before IFRS 9. Third, this increase in EM was only for banks in countries with low RQ – in countries with high RQ, this study finds no change in EM after IFRS 9. Altogether, these results suggest that, first, EM and CM increased after IFRS 9 and, second, this increase in EM depended on the RQ of a bank’s country.

This paper identifies how the adoption of IFRS 9 affected EM and CM by European banks. The main contribution of this paper is that it examines the impact of the adoption of IFRS 9 on EM and CM by European banks using data from banks’ actual financial statements.

The purpose of this study is to examine the relationship between pollutant emissions, financial development and IFRS in developed and developing countries between 1998 and 2022.

Data were obtained from World Development Indicators and World Governance Indicators of the World Bank.

Using FGLS and GMM estimators, the results provide evidence that financial development has a significant positive impact on a variety of pollutant emissions. However, this positive impact is moderated by IFRS for the overall sample and country income groups.

Governments and regulatory organizations should support companies’ investments in clean energy and technologies to slow down environmental degradation. Tax credits and subsidies may be helpful to achieve this goal. Also, governments may encourage companies to cooperate with universities and research institutions to develop environment-friendly production and distribution methods to reduce pollution. Although stakeholders may obtain information about environmental issues in financial statements that are prepared in accordance with IFRS, there is a need for standardization of their contents.

Greenhouse gases are major contributors to climate change and global warming. In addition to private costs borne by producers, the production and consumption of products have social costs arising from pollution that affects air, water, and soil. Pollution adversely affects people's physiological and psychological health, which decreases labor productivity, thereby leading to a decrease in economic growth.

According to the author’s knowledge, this is the first study that examines the impact of IFRS on the relationship between financial development and pollutant emissions.

The purpose of this study is to provide a harmonisation framework for the diverse accounting practices by extractive industries.

The study takes a three-stage approach. The first involves a comprehensive literature review of the historical evolution of accounting regulations by extractive industries. The second involves constructing an accounting practice index for extractive industries. The third involves constructing a harmonisation framework.

The accounting practice index provides empirical evidence of the wide diversity of accounting practices by extractive industries. Analysis of the literature review addresses the several attempts by accounting and regulatory bodies to standardise the diverse practices of accounting by extractive industries and reasons for the lack of successful standardisations. The authors extract lessons from these previous attempts and propose a harmonisation framework.

The proposed harmonisation framework can be used to align together the diverse accounting practices by extractive industries and enhance comparability and consistency of accounting figures and statements produced by these industries. Harmonising the diverse accounting practices is crucial for investment decision-making.

The harmonisation framework is the first of its kind that could enhance the comparability of accounts of extractive industries’ firms and be used to harmonise diverse accounting practices by other industries.

This study aims to examine the influence and behaviour of the European Financial Reporting Advisory Group (EFRAG)/European Commission, and the International Financial Reporting Standards (IFRS) Foundation/International Sustainability Standards Board in the standardisation of sustainability reporting arena and their implications for the Global Reporting Initiative’s (GRI) current position.

This paper draws on the arena concept, particularly the work of Renn (1992) and Georgakopoulous and Thomson (2008), to explore the EFRAG and the IFRS Foundation’s behaviour towards the standardisation of the sustainability reporting arena and their implications for the GRI’s current position. Further, the documents and public releases pertinent to the activities and output of the GRI, the EFRAG/European Commission and the IFRS Foundation are used. The documents are screened and analysed based on the key elements of arena concept that emerged, which includes “agenda, claims, network of bodies and group engaged, interaction and behaviour with arena issues (audience, materiality, scope and core priorities, purpose of reporting and relevance to sustainable development)”.

This study reveals the source of motivation and influence of the new standard setters in the sustainability reporting arena and documents the relevance of their behaviour as an actionable strategy to change the arena rule. Particularly, this paper demonstrates the perceived fall away from driving business behaviour towards the pursuit of sustainable development if the GRI and its standards cease to exist.

The pathway to achieve sustainable development and improve sustainability impact disclosure remains a debatable issue among policymakers and users of sustainability reporting standards. This study reconstructs the awareness of different dynamics at play inhibiting the harmonisation of sustainability reporting standardisation and the importance of the GRI in pursuing global sustainable development.

The pattern of behaviour and agenda of sustainability institutions and influential standard setters harnessed in this paper are aimed at enabling the existence of the rules that can uphold the primary focus of the sustainability reporting arena, particularly in achieving global sustainable development.

This paper furthers the understanding of the importance of the GRI in upholding the key tenets and traditional agenda of sustainability reporting and sustainable development.