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We assess the impact of NZ IAS 32 on the financial reporting of convertible financial instruments by retrospective application of the standard to a sample of New Zealand companies over the period 1988 ‐ 2003. NZ IAS 32 has a broader definition of liabilities than does the corresponding current standard (FRS‐31) and it does not permit convertibles to be reported under headings that are intermediate to debt and equity. The results of the study indicate that in comparison with the reported financial position and performance, the reporting of convertibles in accordance with NZ IAS 32 would result in higher amounts for liabilities and higher interest. Thus, analysts using financial statement information to assess risk of financial distress will need to revise the critical values of commonly used measures of risk and performance when companies report under NZ IAS

The purpose of this paper is to discuss the feasibility of preparing a statement of owner equity (SOE) and statement of cash flows (SOCF) for the agricultural sector. Also, the use of the Agricultural Resource Management Survey (ARMS) to collect data needed to supplement the US farm sector accounts to prepare a sector SOE and SOCF is discussed.

An SOE and SOCF for an individual producer was used to provide an example format for preparing an SOE and SOCF for the agricultural sector and to identify the data needed from the ARMS survey to supplement farm sector accounts.

The format and data needed to prepare a sector SOE and SOCF were identified and the feasibility of the collection of that data using current ERS/USDA survey collection methods would provide the data needed to prepare the statements. However, the use of two independent data collection authorities to collect the data would result in an agricultural sector SOE and SOCF that would not reconcile.

The paper initiates a dialog of possible alternatives available to the ERS/USDA and researchers concerning data needed and data sources available to prepare an agricultural sector SOE and SOCF, as well as the shortfalls and inaccuracies that would result.

The purpose of this paper is to address two questions: did adoption of Statements of Financial Accounting Standards No. 132(R) and No. 158 affect neutrality of the financial reporting with regard to the disclosed expected rate of return (ERR) on pension assets assumptions, and did pension asset allocations change in response to the new recognition and disclosure requirements?

The author uses several measures of association between reported expected return and pension assets allocations to assess neutrality of the reported ERR. The series of tests explores changes in correlations between asset allocations and expected rates of return and changes in the implied risk premiums following adoption of Statements No. 132(R) and No. 158. Granger causality analysis is used to explore the second research question: did pension asset allocations change in response to the new recognition and disclosure requirements?

The empirical results are consistent with improved neutrality of financial reporting following adoption of Standard No. 132(R). There were no detectable changes in neutrality following adoption of Standard No. 158. While the data are consistent with portfolio allocations changing to a greater degree than did expected rates of return following Statement No. 132(R) adoption, the effect appears short-lived.

The overall results are consistent with Standard 132(R) having a positive effect on the neutrality of the reported ERR. Also, there is no evidence of persistent and systematic structuring of transactions around preferred financial reporting outcomes.

This study explores the relationship between brand image and brand equity in the context of sports sponsorship. Keller's (1993, 2003) customer-based brand equity models are the conceptual inspiration for the research, with Faircloth, Capella, and Alford's (2001) conceptual model – adapted from the work of Aaker (1991) and Keller (1993) – the primary conceptual model. The study focuses on the sponsorship relationship between the New Zealand All Blacks and their major sponsor and co-branding partner, adidas. The sporting context for the study was the 2003 Rugby World Cup held in Australia. Data were collected from two independent samples of 200 respondents, utilizing simple random sampling procedures. A bivariate correlation analysis was undertaken to test whether there was any correlation between changes in adidas' brand image and adidas' brand equity as a result of the All Blacks' performance in the 2003 Rugby World Cup. Results support the view that Keller (1993, 2003) proposes that brand image is antecedent to the brand equity construct. Results are also consistent with the findings of Faircloth et al. (2001) that brand image directly impacts brand equity.

This study examines the value relevance of recognised and disclosed revaluations of land and buildings for a large sample of Australian firms from 1993 through 1997. In contrast to prior research, we control for risk and cyclical effects and find no difference between recognised and disclosed revaluations, using yearly‐cross‐sectional and pooled regressions and using both market and non‐market dependent variables. We also find only weak evidence that revaluations of recognised and disclosed land and buildings are value relevant.

This chapter focuses on the IFRS 15 Revenue from Contracts with Customers and IFRS 16 Leases in the airline industry considering the case of Air France – KLM (AF-KLM). This airline timely adopted IFRS 15 and early adopted IFRS 16 for the year 2018 and restated its 2017 financial statements using the full retrospective method so that the 2018 financial statements of the airline provide comparative financial information during the transition phase from IAS 18 to IFRS 15 as well as from IAS 17 to IFRS 16. In the first part of the chapter, liquidity, solvency, and profitability ratios along with cash flow ratios were used to analyze the cumulative effect of IFRS 15 and IFRS 16 using 2017 and restated 2017 financial statements. In this context, results indicate that the liquidity ratios decreased, and the solvency ratios increased in general. In addition, the cumulative effect of IFRS 15 and IFRS 16 created an upward change in general on profitability ratios based on the several performance parameters that should be considered during the transition from IAS 18 to IFRS 15 and from IAS 17 to IFRS 16. Overall, IFRS 15 has minor effect and IFRS 16 has major effect on the financial statements of AF-KLM. In the second part of the chapter, the compliance level of the mandatory disclosures requirements of the airline was examined from the lessee standpoint and the research pointed out that the airline fully complied with these disclosures at its first adoption of IFRS 16 and provided some voluntary disclosures as well.

Knight's Industrial Law Reports goes into a new style and format as Managerial Law This issue of KILR is restyled Managerial Law and it now appears on a continuous updating basis rather than as a monthly routine affair.

Sees the objective of teaching financial management to be to help managers and potential managers to make sensible investment and financing decisions. Acknowledges that financial theory teaches that investment and financing decisions should be based on cash flow and risk. Provides information on payback period; return on capital employed, earnings per share effect, working capital, profit planning, standard costing, financial statement planning and ratio analysis. Seeks to combine the practical rules of thumb of the traditionalists with the ideas of the financial theorists to form a balanced approach to practical financial management for MBA students, financial managers and undergraduates.

Effective internal control over financial reporting (ICFR) should either prevent or enable correction of any material misstatement in a firm’s financial statements. Independent auditors, guided by professional standards, prepare an ICFR audit report, which provides a gauge by which the public can evaluate the reliability of a firm’s financial information. A firm manager may be tempted to misstate financial statements if he/she perceives a substantial reward for doing so. This study examines whether managers and firms are rewarded for misstating their financial statements in situations where there are incentives to do so, specifically, when an industry-leading peer is fraudulently inflating its reported earnings. The authors test to see if managers experience an increase in compensation as a result of misstatement. The authors also test to see if their firms benefit from misstating via changes to their cost of capital. Results suggest that neither managers nor their firms benefit from managing earnings by misstating financial statements. These findings are important, because a manager who ex ante understands that misstating will not lead to benefits personally or his/her firm is less likely to misstate in the first place.

We review and analyze the accounting literature that examines the effects of accounting conservatism on financial statements and financial statement users. We begin by analyzing how conservatism affects the reported numbers on the financial statements. These studies primarily evaluate how conservatism affects earnings quality, including earnings persistence and the presence of earnings management. Next, we assess the effect of accounting conservatism on the users of the financial statements. We identify three primary users of the financial statements: (1) equity market users (2) debt market users and (3) corporate governance users. Within each of these categories, we analyze the findings of prior research and explore unanswered research questions. By analyzing the effects of accounting conservatism from a diverse range of research topics, we inform the discussion on the costs and benefits of accounting conservatism.