The purpose of this paper is to determine the indebtedness level of hotels operating in the Republic of Serbia during the period from 2008-2012. It is presumed that the weakened worldwide economy resulted in the decrease of general business solvency and increase of bankruptcy probability in all industries. Service providers have certainly not been left out, and hotels have been in the focus of this paper. We have collected available financial statements of hotels operating in the Republic of Serbia for the period from 2008-2012. We have calculated several bankruptcy prediction models including: Altman's Z' and Z''-score, M-score, Kralicek's df score and Z-score for hospitality industry. The results show that the average implicated bankruptcy probability increased in 2010 and 2011, and reached its peak value in 2011. When comparing 2008 and 2011, the average Altman's scores recorded decrease of approximately 70% and other scores confirm the same results. Therefore, it can be concluded that hotel industry in Serbia recorded the weakest results and has been insolvent and had the greatest risk of going bankrupt in 2010, and especially in 2011.
Up until now accounting standards regarding financial instruments were changed several times. The latest change was the issuance of the IFRS 9 Financial instruments published for the purpose of simplifying the rules in its predecessor IAS 39 Financial instruments: recognition and measurement. From the above mentioned changes of accounting regulatory regime for financial instruments we may conclude that accounting bodies, so far, have not found the adequate approach and treatment for the financial instruments. They considered that fair value would be a revolutionary measure for the financial instruments and that this measure would provide more relevant, transparent and comparable information. But the standard setters did not predict that this measurement attribute might have an effect on earnings power and financial position of a company. In this paper we observe critiqually the main differences between IFRS 9 and IAS 39 regarding the recognition and measurement of financial instruments and with an emphasis on of some problems of early adoption of IFRS 9 by companies.
Abstract:The purpose of this paper is to determine the changes proposed by the IFRS 9 -Financial instruments, regarding the classification of financial assets and its effects on the financial position of a business entity and the results of operations in comparison to the former criteria established by the IAS 39 Financial instruments: recognition and measurement. The issuance of the IFRS 9 in July 2014 was seen as the final stage in the project that IASB established regarding the financial instruments. The business model criteria used by the IFRS 9 are based on the financial, contractual cash flow incurred by the financial instrument or the cash flow caused by selling the instruments. Their proponents believe that these criteria are well-structured, objective and can be easily implemented by the users of financial statements. The former criteria in IAS 39 are based on the management intent regarding the instruments and some proponents of the new standard believe that they cause more judgment and earnings volatility than the newly established criteria. The purpose of this paper is to indicate that the change of classification criteria did not meet the specified goals regarding the comparability of financial statements and possible earnings volatility. The only goals met are related to information relevance and confidentiality.
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