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In 2005, IFRS became mandatory for consolidated financial statements of French-listed companies. Our students had increasingly international backgrounds, internships, and jobs after graduation. Therefore, we felt the need to modify our French GAAP-based introductory accounting class to a course using IFRS. This article describes the challenges we faced and the solutions we adopted. Since French GAAP are rules-based and IFRS principles-based, the adoption of IFRS modified our learning goals, the learning strategy, and the assessment methods. We changed from a bookkeeping-oriented approach to one in which students have to define and analyze various transactions with respect to the conceptual framework using broader economic and financial concepts. We also had to modify student behavior from a learning attitude of repeating answers to one of finding answers, which meant further developing their analytical, synthesis, and judgment skills. Class material had to be adjusted to better reflect the complex reality and to allow students to make judgments, thus raising the question to what degree of detail certain topics are taught. This new approach also raised challenges in terms of providing feedback to students, grading, and student evaluation. By raising awareness about these issues, we want to contribute to a smoother transition when switching accounting classes from local GAAP to IFRS in other countries.

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This research investigates the usefulness for financial analysts of segment information disclosed by European intermediate‐size companies reporting under IFRS. While most studies on segment information usefulness focus on the consensus aggregated from financial analysts’ forecasts for blue‐chip companies, our study contributes to the literature by investigating the recommendation reports of financial analysts covering European intermediate‐size companies. The study is based on an original, hand‐collected database obtained from a sample of 339 analysts’ recommendation reports for 146 firms. Our research reveals that though a majority of analysts refer to segment information in their reports, only a few of them use it in their valuation models. Moreover, it also demonstrates that the use of segment information by financial analysts is higher for larger firms than for smaller ones and is not associated with greater forecast accuracy. Hence, our results question the usefulness of segment information disclosures for small firms. © 2016 Wiley Periodicals, Inc.

The adoption of IFRS by the EU has raised issues about its economic consequences in terms of, among others, volatility of corporate profits, taxation of profit and distribution of dividends. Indeed, it has brought the interactions between legal rules for dividend distribution and accounting policies back into focus. The EU company and accounting regulations are based on capital maintenance rules that involve limitations on dividend distribution when certain accounting policies are implemented in individual financial statements under local GAAP. However, while a majority of member states permit IFRS for individual financial statements, the EU regulations are silent on this issue. In this article, we outline an in-depth analysis on legal dividend distribution rules interactions with accounting policies in European countries, whether local GAAP or IFRS are applied. We have selected nine cases of potential recognition of unrealised gains in individual financial statements under local GAAP and/or IFRS, some of which are already specified in the EU regulations. For each case, we have analysed the national accounting regulations and the corporate laws. Our analysis reveals that the limitations on dividend distributions recommended by the EU have been most largely implemented in the national regulations, but not in all countries. It also sheds light on potential loopholes in the current European regulation regarding unrealised gains that may be more systematically recognised under IFRS than under local GAAP: unrealised gains arising from the recognition of deferred tax assets and unrealised gains arising from benefit pensions plan. To fill these gaps in the national regulations and to harmonise the legal basis for dividend distribution better within the EU, we suggest including in the European regulation the concept of ‘realised profits’ and thus ‘distributable profits’ as a required basis for dividend distribution. It involves in the first place identifying relevant criteria that may enable disentangling realised and unrealised profits or losses.