International Financial Reporting Standards

The term International Financial Reporting Standards (IFRSs) has both a narrow and a broad meaning. Narrowly, IFRSs refers to the new numbered series of pronouncements that the International Accounting Standards Board (IASB) is issuing, as distinct from the International Accounting Standards (IASs) series issued by its predecessor International Accounting Standards Committee (IASC) from 1973 to 2000. More broadly, IFRSs refers to the entire body of IASB pronouncements, including standards and interpretations approved by the IASB and IASs and SIC interpretations approved by the predecessor IASC.

Since we intended to investigate the changes which occur in real earnings management (REM), following the convergence of accounting standards with the implementation of International Financial Reporting Standards (IFRS) in Malaysia in 2008, an attempt has been made through this study. With the passage of time, many researchers were inclined to have suggested that convergence with IFRS improves the quality of earnings. It was also argued that the implementation of strict accounting standards curtails the management’s ability to appropriately use accruals-based earnings management activities. Consequently, management substitutes the accruals-based earnings management with less perceptible and hardly detectable real earnings management (Zandi et al., 2019). The case presented by Soderstrom et al. (2016) attempted to show that management generally used different REM methods to achieve the required objectives, apparently to be found in case of any discrepancies. The REM includes the price discounts so as to temporarily boost the sales, increase the production and/or reduce the production cost per unit, along with a reduction in discretionary expenditure. Again, Sakaki et al. (2017) indicated that managers were not much interested in accruals-based earnings management, just because it was not easy to manipulate the accounts after the implementation of IFRS. Hence, they found it easier to shift towards the real earnings management. Moreover, some of the studies which attempted to explore the adoption of IFRS, could not find much viable support for state-owned enterprises (SOEs), since the real earnings manipulation had not been practiced by the management. Surprisingly SOEs are more dependent on and inclined towards state-support rather than looking for dependence on the external sources.

Globalization, capital market crash and the Enron’s case led the accounting profession to insist on the need for a single set of high quality reporting standards. International Financial Reporting Standards (IFRS) were first adopted in 2005 by EU countries while Nigeria agreed to adopt in 2012. The question is: How does IFRS adoption improve the monetary relevance of accounting information? Several studies have explored the monetary rele- vance of IFRS adoption; however, they are based on foreign countries while Nigerian researches do not contain empirical ev- idence as they are mostly theoretical. This study therefore seeks to investigate the effect of IFRS adoption on financial perfor- mance. The study used correlation research design and data on Earnings per Share (EPS), Change in Earnings per Share (CEPS), Book Value per Share (BVPS) and net profit margin. Getting bearing from the finding of this study, it is realized that the gen- eral notion of improved value relevance with the adoption of IFRS has been confirmed. Book values and change in earnings proved value irrelevant.

The adoption of IFRS by Nigeria is expected to enhance information asymmetry and other qualitative enhancing attributes of financial reporting in Nigeria. However, the extent that it has gone in achieving this aim is the issue upon which this study is underpinned. Adebiyi, (2012) posits that accounting framework has been shaped by International Financial Reporting Standards (IFRS) to provide for recognition, measurement, presentation and disclosure requirements relating to transactions and events that are reflected in the financial statements. Users of financial statement world require sound understanding of financial statement but this can only be made possible if there is General Accepted Accounting Practice (GAAP). With globalization of finance gaining ground, it will enable the world to exchange financial information in a meaningful and trustworthy manner. Investors from all over the world rely upon financial statements before taking decisions and different countries adopt accounting treatments and disclosure patterns with respect of the same economic event. And as such, it will surely create confusion among the users while interpreting financial statements.

1 We have audited the attached IFRS reconciliation schedules of the ENEL Group, comprising the consolidated balance sheets as at 1 January 2004 and 31 December 2004, consolidated income statement for the year ended 31 December 2004 and notes thereto, disclosed to the market on 14 June 2005 with the document entitled "Transition to International Financial Reporting Standards". The above IFRS reconciliation schedules are derived from the consolidated financial statements of ENEL S.p.A. as at and for the year ended 31 December 2004, prepared in accordance with Italian legislation governing the preparation of financial statements. We audited such consolidated financial statements and issued our audit report thereon on 10 May 2005. The IFRS reconciliation schedules have been prepared as part of the transition to the International Financial Reporting Standards (IFRS) approved by the European Commission. The IFRS reconciliation schedules are the responsibility of the parent company's management. Our responsibility is to express an opinion on these schedules based on our audit.

The paradigm shift in the economic environment in India during last few years has led to increasing attention being devoted to accounting standards as a means towards ensuring potent and transparent financial reporting by any corporate. ICAI, being a premier accounting body in the country, took upon itself the leadership role by establishing ASB, more than twenty five years back, to fall in line with the international and national expectations. Today, accounting standards issued by the Institute has come a long way. The ICAI as the accounting standard - setting body in the country has always made efforts to formulate high quality Accounting Standards and has been successful in doing so. Indian Accounting Standards have withstood the test of time. As the world continues to globalize, discussion on convergence of national accounting standards with International Financial Reporting Standards (IFRS) has increased significantly. With this background, this paper focused on benefits and beneficiaries of implementation of IFRS, differences in Indian GAAP and IFRS and challenges in implementation of IFRS in India.

This paper builds upon the huge body of research in the academic fields of accounting, finance and economics. It explores the background and the adoption of International Financial Reporting Standards (IFRS) in various countries; the cost-benefit analysis associated with the practical application of IFRS in corporate reporting by individual companies in those countries that have decided to go the IFRS way; a special case of the convergence and possible adoption by the United States of America is analyzed critically. Threats and challenges to the successful adoption of the IFRSs are detailed. Emerging issues in the adoption of IFRS are examined.

The subject of the research is the set of theoretical and practical approaches to the recognition of assets of the agricultural enterprises of the Omsk region in the accounting under International Financial Reporting Standards (IFRS). The research objective is the development of an optimal testing model of assets of the agricultural enterprises for compliance with IFRS. The study was conducted on the basis of financial statements prepared under the Russian Financial Reporting Standards. The three asset items with the largest share were allocated in the statements: Fixed assets, inventories and accounts receivable. The most essential items were allocated as part of fixed assets: machinery and equipment and agricultural products respectively. Accounts receivable were tested for compliance with IFRS. The calculation of market price taking into account the correction factor in question considering the technical condition of vehicles was performed upon testing of machinery and equipment. The calculation of net realizable value based on market prices for the products was performed upon testing of machinery and equipment. The market-value appraisal of the receivable by discounted cash flows was performed upon testing. The proposed testing method has a practical value. It can be used in the preparation of financial statements under IFRS, on the basis of financial statements prepared in accordance with the Russian Financial Reporting Standards. It has been established that the machinery and equipment and agricultural products are reflected in the financial statements in accordance with IFRS. Because of overdue accounts the accounts receivable are substantially overstated.

This research investigates International Financial Reporting Standards (IFRS) and financial reporting quality among Nigerian listed companies. The research focused on qualitative characteristics of financial reporting (value relevance and timeliness). The study determined the financial reporting quality of 77 sample companies listed on Nigerian stock exchange. The study was limited to one year financial statement, which used UUM-Data stream in collecting the relevant data. The regression result of value relevance of financial reports reveals that there is a positive and significant relationship between stock price with book value of equity and net income after the adoption of IFRS. Similarly, timeliness of financial information regression results also revealed that return on assets and returns on equity are positive and significantly associated with stock returns after IFRS adoption in Nigeria. The findings implied that the financial reporting of Nigerian listed companies were value relevant and timelier after the adoption of IFRS. The significant positive relationship between accounting measures on stock price and stock returns shows that investors’ can predict future market value of individual securities, as the efficient market theory posits that securities prices disclose a significant amount of information from many different sources in the securities market and important current financial information of companies. Investor receives considerable information simply by knowing the price information on time which found more value relevant.

Currently, the Ministry of Finance is implementing Decision 480/QD-TTG dated 03/18/2013 of The Prime Minister on approving the Strategy Accounting - Audit 2020, Vision 2030 and implementing the Resolution 35/NQ-CP of the Government dated 16.05.2016 related to the support and development of enterprises by 2020. Accordingly, the development and improvement the legal framework of Financial Reporting standards in Vietnam is one of the key tasks and urgent needs to be developed to meet the requirements of the economy in the period of integration. The system of International Accounting Standards, including the International Accounting Standards (IAS) and the standards of international financial reporting (IFRS) was issued, adjusted, updated and replaced by The International Accounting Standards Board. International Accounting Standards is an important condition to ensure that companies and organizations around the world can apply uniform accounting principles in the work of preparing and presenting financial statements. Currently, many countries around the world such as USA, Japan and European countries, Asia Pacific are approaching IFRS convergence trend. In the trend of globalization of accounting, Vietnam will not be outside the process of integration with the system of International Financial Reporting Standards. This article will review the process of formation and development of IFRS, the IFRS trends and the advantages and disadvantages of applying IFRS in Vietnam.

Thanks to the joint efforts of the FASB and the IASB, the differences between GAAP and IFRS have diminished considerably. The SEC believes that by the end of 2011 it will be in a position to decide on whether to 1) adopt International Financial Reporting Standards as the financial reporting system for U.S. public companies, 2) continue with the convergence project, or 3) reject IFRS altogether by the end of 2011. We highlighted what we think are the major benefits and drawbacks to each option. Our analysis of the adoption status of the top ten economic powers suggests that the use of a common set of financial reporting standards is still far away. The use of carve-outs hints that the “one size fits all” approach to financial reporting standards might never be achieved, and it might be reason enough for the SEC to reject IFRS. However, we think that rejection of IFRS carries a heavy political penalty and should only be used as a last resort.

The reverberations of Wall Street had to be felt across the global banking system. Last September, the world economy seemed to be hurtling down in a way that had initially raised the spectre of the Great Depression in America of the late 1920s. This is based largely on the performance of stock markets which are supposed to reflect future trends in the real economy. However, such knowledge embedded in the markets can be imperfect, as we have learnt by now. In some ways, the global financial crisis and its fallout are forcing economic agents to acquire new knowledge in regard to what might happen in the future. It was difficult to explain rationally why the stock markets were furiously running up even as company balance sheets were still bleeding. A few years ago, International Financial Reporting Standards (IFRS) were a distant possibility. Today, the reality is far different. We are in a dramatic shift that is fast making IFRS the most widely accepted accounting model in the world. As the business environment becomes increasingly global and companies routinely list on stock exchanges in many countries, the need for consistent worldwide reporting standards intensifies. IFRS clearly addresses this issue; its goal is to create comparable, reliable, and transparent financial statements that will facilitate greater cross-border capital raising, trade and better corporate governance practices. Thus acceptance of IFRS is gaining momentum across the globe. IFRS transition program for any organization will have multi – dimensional effect because of differences which exist between IFRS and Local GAAPs. The objectives of the paper is to highlight the nature of such differences with examples along with analysing the provisions of IFRS, comparative analysis of IFRS with Indian GAAP system, benefits, and major issues in first time adoption of IFRS in Indian companies with the help of case study of Indian corporate.

This article provides an extensive analysis of application of International Financial Reporting Standards companies with publicly traded shares in the Czech Republic for 2013. At fi rst the attention is paid to the basic requirements of International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) and to evaluation of proposed method. Then followed research results, based on an answer to the question of whether the companies are preparing their fi nancial statements in accordance with IAS / IFRS, i.e. whether they serve plenty of mandatory information, and further whether individual companies act similarly. The object of the research consists in further observations regarding the implementation of the new IFRS 9 Financial Instruments, which is designed to replace IAS 39 Financial instruments: recognition and measurement. The level of the information presented was evaluated using a signed test. Using this statistical method we can conclude that companies submit their fi nancial statements in accordance with IAS / IFRS. Using the Friedman test, it was found that the group of companies proceeds with the application of individual IAS / IFRS alike. Only two of seven respondents have already implemented IFRS9. Statistical analysis confi rmed that companies reported, in their fi nancial statements, all mandatory information that is relevant to stakeholders. On the other hand, there are also signs pointing to the contrary, but these are not statistically signifi cant. This analysis was provided with detailed knowledge about this phenomenon.

Developments in the global capital market have made the adoption of International Financial Reporting Standard (IFRS) more signifi cant than ever before. The purpose of this study is to examine the accountants’ perception of IFRSs adoption in Yemen. We also seek the accountants’ view on whether Yemen should adopt the IFRSs or not, and on the expected time taken to adopt the accounting standards. We also examine the difference in opinion between academicians and practitioners regarding the adoption of IFRSs. In this regard, this study carries out a survey of 48 Yemeni accounting postgraduate students in Malaysian public universities. We fi nd that a majority of the respondents acknowledge the benefi ts of adopting IFRSs in Yemeni companies. Moreover, a majority of the respondents (82.9%) agree that Yemeni companies should adopt IFRSs. About 58.6% of respondents expect the period of IFRSs adoption in Yemen to be within three to 10 years, while 41.5% expect it to be more than 10 years. The results of this study may help policy-makers and the Yemeni Association of Certifi ed Public Accountants make more precise decisions regarding IFRSs adoption in Yemen. Keywords: International Financial Reporting Standards, Accounting Standard Convergence, Yemen

The term International Financial Reporting Standards (IFRSs) has both a narrow and a broad meaning. Narrowly, IFRSs refers to the new numbered series of pronouncements that the International Accounting Standards Board (IASB) is issuing, as distinct from the International Accounting Standards (IASs) series issued by its predecessor International Accounting Standards Committee (IASC) from 1973 to 2000. More broadly, IFRSs refers to the entire body of IASB pronouncements, including standards and interpretations approved by the IASB and IASs and SIC interpretations approved by the predecessor IASC.

By now you’ve likely heard the increasing warning signals about the inevitable movement toward International Financial Reporting Standards (IFRS) as a single set of globally accepted accounting standards. While this was intended to provide consistency in fi nancial reporting standards and increased globalization of companies, it also has resulted in signifi cant efforts outside of fi nancial reporting, in areas such as information technology and human resources, and therefore, requires the attention of corporate executives and leaders throughout the organization. Additionally, it may also provide a strategic opportunity for positive organizational change for those who understand the benefi ts of a reasoned and deliberate conversion process. Of course, like any signifi cant business decision, determining the timing and pace of conversion to IFRS requires an understanding of the potential costs and benefi ts. It is important to make an informed choice based on a thorough analysis. Recent events suggest that reporting under IFRS will be allowed or required for most public companies in the U.S. and around the globe within the next few years. On November 14, 2008, the SEC issued its long-awaited proposed IFRS “roadmap” outlining milestones that, if achieved, could lead to mandatory transition to IFRS starting in fi scal years ending on or after December 15, 2014. The roadmap also contains proposed rule changes that would give certain U.S. issuers the early option to use IFRS in fi nancial statements for fi scal years ending on or after December 15, 2009. The SEC believes that “the use of a single, widely accepted set of high-quality accounting standards would benefi t both the global capital markets and U.S. investors by providing a common basis for investors, issuers and others to evaluate investment opportunities and prospects in different jurisdictions.” The roadmap also notes that IFRS has the potential “to best provide the common platform on which companies can report and investors can compare fi nancial information.” The SEC is seeking comments on numerous questions raised in the proposed roadmap. The comment period is expected to run until mid-to-late February 2009.

The International Financial Reporting Standards (IFRS) are guidelines and give a framework for reporting performance of the companies, in order to properly assess the financial health of organizations. The IFRS aims for unify the different national financial statements in order to create the comparability of them. IAS 41 Agriculture is a special standard, which sets out the accounting for agricultural activities and distinguishes between biological assets (living plants and animals), agricultural produce (harvested product of the entity's biological assets) and products that are the result of processing after harvest. IAS 41 applies to biological assets, but bearer plants, agricultural produce at the point of harvest, and government grants that are connected to these biological assets are exception. Land that is connected to agricultural activity (IAS 16 Property, Plant and Equipment), intangible assets (IAS 38 Intangible Assets) in relationship with agricultural activity, bearer plants and government grants that are connected to them are not in the scope of this Standard. The standard generally requires biological assets to be measured at fair value less estimated costs to sell, unless fair value cannot be reliably measured, in this case, the asset is measured at cost less accumulated depreciation and impairment losses. Measurement of the agricultural activity depends on the status of them, it means: where are the assets in the process of agricultural activity (biological assets or agricultural produce or products that are the result of processing after harvest). Depending on this classification various standards deal with different assets (IAS 41/IAS2). In these mixed and complicated circumstances this paper tries to make a clear picture of the measurement of various agricultural activities, and can be a basis for further examination.

This study reviews the accounting literature which investigates the effects of International Financial Reporting Standards (IFRS) on firms’ financial performance to answer a debating question of how effective are the accounting standards in affecting financial performance and to provide guidance for future studies. The focus of the review is three primary streams, first, reasons and evidence of differences between countries in accounting practices; second, theories justifying the transition from local Generally Accepted Accounting Principles (GAAP) to IFRS; Third, the effect of accounting standards on firms’ financial performance regarding three broad groups: (1) Common law countries (2) Civil law countries, and (3) Middle East and North Africa (MENA) region countries affected by both sharia law and civil law. The review demonstrates that the transition from local GAAP to IFRS has been successful in affecting firms’ financial performance measures in less shareholder-oriented civil law and MENA region countries. This was attributed to the IFRS fair value orientation, which causes volatility in the statement of financial position and financial performance figures. These impacts, however, usually vary between countries, depending on the pre-transition differences between local GAAP and IFRS. The more the difference, the more volatile the financial performance measures, particularly the profitability ratios. This review’s findings have implications for other jurisdictions, particularly developing countries, where IFRS adoption is already underway. In addition, managers, investors, practitioners, and standard setters can use this review to identify the factors that have been found to influence firm performance, especially in a globalized economy that is increasingly cross-listed.

We found that a CEO’s nationality determines voluntary IFRS adoption, but only in small extent. The results seem surprising because foreign CEOs, similarly to foreign supervisory board members, usually have more confidence in generally accepted accounting standards (IFRS). It should be noted that the majority of CEOs in the companies come from their countries of origin. This phenomenon is typical of relatively small entities, with their business activity located chiefly in their country of origin. The confirmation of this phenomenon can be found in Weber’s (2010) research. Indeed, foreign CEOs are significantly more numerous in companies adopting IFRS as compared with businesses applying local standards. They usually perform managerial, not supervisory functions. CEO positions are frequently held by business leaders who have broad practical knowledge (Ruigrok et al., 2007). They are more aware of the possible benefits resulting from IFRS application. People from other countries, who have international professional experience, are more aware of the positive impact of IFRS on the quality of accounting. Foreign CEOs are more likely to favour world and high quality accounting standards (IFRS) than CEOs operating in local markets. Possibly, foreign executives from less developed markets, who lack broad international experience, do not guarantee IFRS application.

Consider shared services centers: IFRS provides a compelling reason to establish shared services centers, to potentially consolidate dozens of local GAAPs down to a single reporting standard. Geographically- dispersed fi nance offi ces could be drastically reduced or even eliminated in favor of a central fi nance function, strategically located to take advantage of tax incentives, payroll savings, and facilities cost reductions. In many cases, this concept is already aligned with the strategic direction O&G companies have taken or are currently considering relative to their fi nance function.