How has the mandatory adoption in 2005 of International Financial Reporting Standards in (IFRS) affected information flow for investors in Australia? This paper investigates impact by examining synchronicity issues. Morck et al. (2000) label the degree to which stock prices depend upon market and industry wide information as market synchronicity, and the degree to which they reflect firm specific information as idiosyncratic dependency. Increased synchronicity can signal several events, including a loss of confidence in firm specific accounting data, reduced transparency, or evidence of a greater degree of cross sectional comparability. We develop and test three theoretical models on the impact of IFRS and find a general decrease in synchronicity in the first two post-IFRS years, followed by a reversion to a significantly higher level in later years. Further tests reveal lower analyst forecast earnings errors post-IFRS. Results provide restrictive support for the International Accounting Standards Board contention that IFRS accounting provides higher specific and comparable information content -at least for sophisticated financial analysts.
This study proposes and tests an alternative to the extant earnings management explanation for zero and small positive earnings surprises (i.e., analyst forecast errors). We argue that analysts' ability to strategically induce slight pessimism in earnings forecasts varies with the precision of their information. Accordingly, we predict that the probability that a firm reports a small positive instead of a small negative earnings surprise is negatively related to earnings forecast uncertainty, and we present evidence consistent with this prediction. Our findings have important implications for the earnings management interpretation of the asymmetry around zero in the frequency distribution of earnings surprises. We demonstrate how empirically controlling for earnings forecast uncertainty can materially change inferences in studies that employ the incidence of zero and small positive earnings surprises to categorize firms as suspected of managing earnings.
De nieuwe standaard voor omzetverantwoording, IFRS 15: Revenue from contracts with customers, is op 28 mei 2014 verschenen. IFRS 15 heeft als doel de regelgeving voor het verantwoorden van omzet te verduidelijken en een universeel model te creëren om verschillende soorten transacties in verscheidene industrieën op vergelijkbare wijze te verwerken in de jaarrekening. In dit artikel wordt de conceptuele fundering van IFRS 15 besproken. IFRS 15 resulteert in een verschuiving van de winst-en-verliesrekeningbenadering van verslaggeving naar een balansbenadering. De regelgever meent dat hiermee de informatiewaarde van de jaarrekening wordt verhoogd. Vervolgens wordt door middel van empirisch onderzoek de percepties van opstellers van de jaarrekening op de mogelijke kosten en baten van het nieuwe model geanalyseerd. Een analyse van de comment letters op de Revised Exposure Draft Revenue from contracts with customers (IASB, 2011) toont aan dat opstellers van de jaarrekening menen dat de kosten die gemaakt moeten worden voor de uitgebreide informatievoorziening onder IFRS 15 de baten overstijgen. Ze geven aan zich het meest zorgen te maken over de grote toename van de verplichte informatieverschaffing, de ontoereikendheid van bestaande informatiesystemen om deze informatie te verschaffen en de retrospectieve toepassing van IFRS 15.
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