Value relevance of accounting data and financial crisis in Europe: an empirical analysis

Devalle, Alain

doi:10.5296/ijafr.v2i2.2527

Cited by 9 publications

(5 citation statements)

References 39 publications

(35 reference statements)

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…This suggests that value relevance of accounting figures improved during the financial crisis period. This is in line with the findings of Devalle (2012), who found that the financial crisis had a positive impact on the value relevance of accounting figures prepared under IFRS. However, the coefficient of the financial crisis variable is negative and statistically associated with share prices at a level of 5% when looking at the sub-sample of TC adopting IFRS.…”

Section: Resultssupporting

confidence: 92%

Comparing the value-relevance of AAOIFI versus IFRS accounting numbers in the Takaful industry

Mejri

Othman

Abdou

et al. 2022

JIABR

View full text Add to dashboard Cite

Purpose This study aims to compare the value relevance of accounting numbers prepared under the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards with those produced under the International Financial Reporting Standards (IFRS) for Takaful companies (TC). Design/methodology/approach The authors assess the value relevance of accounting numbers using the Easton and Harris (1991) and Ohlson (1995) return and price models. They also use 54 insurance companies from 10 developing countries in Asia and the Middle East from 2006 to 2015. Findings The analysis shows that book value is significantly related to stock price under AAOIFI and IFRS. It also shows that TC adopting AAOIFI accounting standards have a more significant effect on stock price. This suggests that AAOIFI standards are more value relevant than IFRS. Practical implications TC and their stakeholders can use the findings to determine which accounting standards (IFRS or AAOIFI) produce the more relevant accounting information. This study is useful for investors that consider Islamic ethical practices to make their investment decisions for the standards-setting bodies that focus on establishing accounting standards for the Takaful industry. Originality/value The authors investigate a new aspect of the topic of value relevance. To the best of the authors’ knowledge, they believe this is the first paper examining the value relevance of TC’ accounting information prepared under AAOIFI and IFRS.

show abstract

Section: Resultssupporting

confidence: 92%

Comparing the value-relevance of AAOIFI versus IFRS accounting numbers in the Takaful industry

Mejri

Othman

Abdou

et al. 2022

JIABR

View full text Add to dashboard Cite

show abstract

“…Clarkson et al (2009) used traditional linear pricing model and analyzed whether there was a significant impact on the value relevance of earnings per share and book value per share after IFRS adoption in Australia and Europe and found that accounting information measured under IFRS and local GAAP have the same explanatory power. Contrary to the study of Devalle (2012), who concluded that after IFRS adoption in Germany, the UK, and France, value relevance of earnings per share increased and book value per share increased only in the UK and decreased in other countries. In Belgium, Jermakowicz (2004) analyzed the effects of IFRS on BEL-20 firms and concluded that switching from Belgian GAAP to IFRS resulted in a significant impact on equity as well as net income.…”

Section: Review Of Literaturecontrasting

confidence: 85%

Value Relevance of Accounting Information: A Review of Empirical Evidence Across Continents

Bhatia

Mulenga

2019

Jindal Journal of Business Research

View full text Add to dashboard Cite

In the last two decades, accounting literature has focused increasingly on examining value relevance of accounting information. After the announcement of IFRS adoption, there has been a growth in the literature, which links value relevance of accounting information with IFRS adoption. This study aims to provide a brief literature and presents empirical findings. The purpose is to help future researchers to have the understanding of this nature of the study and identify gaps in the current literature. The article covered 90 empirical research papers published between 1993 and 2016 from various countries across continents, and the majority of them concluded that accounting information is relevant across continents before and after IFRS adoption, while few hold the opposite view. Few studies show no evidence in the improvement of accounting information after IFRS adoption.

show abstract

“…Devalle, 2012;Graham et al, 2000) point out that the state of the economy affects value relevance. Devalle (2012) documents that the comprehensive income statement provides more value relevance than the net income provided in the income statement. This conclusion means that the financial recession is positively associated with value relevance.…”

Section: The Proponents Of Fva and The Gfcmentioning

confidence: 99%

Fair Value Accounting and Implications for the Auditing Profession: Historical Overview

Alharasis

Prokofieva²,

Alqatamin

et al. 2020

AFR

View full text Add to dashboard Cite

This paper explores the link between the introduction of fair value measurements (FVM) and the development of the Global Financial Crisis (GFC) in 2008-9. The paper aims to provide an historical analysis of the development of the Enron scandal with a focus on fair value accounting (FVA) and provides a narrative literature review of the subsequent economic downturn, its effect on the auditing profession and audit fees arrangements, implications for FVA, and response of global institutions and standard setters. It provides a theoretical explanation of the underlying antecedents using existing accounting theories. For each reviewed stream of research, the paper establishes the theoretical underpinning and discusses its application supported by the context. The content analysis using NVivo software was employed to analyse existing research and available published information. Based on the comprehensive literature review, the study arrives at two main findings. First, the paper concludes with the controversial use of FVM and establishes a direct connection between Enron’s collapse, the GFC, and improper FVM practices. Secondly, the study identifies the current pricing strategy for audit as an industry response to the abuse of external audit arrangements regarding FVA. Supported by the literature review findings, the paper contributes to the audit research by providing deep insights into the connection between FVA practices, the GFC and development of the audit profession. The paper addresses the lack of foundational research in FVA and establishes a solid background for further studies on FVA and audit profession development in general.

show abstract

Value relevance of accounting data and financial crisis in Europe: an empirical analysis

Cited by 9 publications

References 39 publications

Comparing the value-relevance of AAOIFI versus IFRS accounting numbers in the Takaful industry

Comparing the value-relevance of AAOIFI versus IFRS accounting numbers in the Takaful industry

Value Relevance of Accounting Information: A Review of Empirical Evidence Across Continents

Fair Value Accounting and Implications for the Auditing Profession: Historical Overview

Contact Info

Product

Resources

About