IFRS adoption and firm value: African evidence

Agyei‐Boapeah, Henry; Machokoto, Michael; Amankwa-Amoah, Joseph; Tunyi, Abongeh A.; Fosu, Samuel

doi:10.1080/01559982.2020.1766755

Cited by 35 publications

(37 citation statements)

References 45 publications

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“…As argue by Key and Kim (2020), late adopters have different incentives and exposure to IFRS reporting before adoption; hence, the effect can differ from early adopters. Also, given that the audit market and financial reporting environment of most African countries is significantly different from other countries (Elbannan, 2011;Lassou and Hopper, 2016;Khlif and Samaha, 2014;Agyei-Boapeah et al, 2020), this analytical study on Africa extends the literature.…”

Section: Introductionmentioning

confidence: 53%

Does the impact of IFRS on audit fees differ between early and late adopters?

Tawiah

2021

IJAIM

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Purpose This study aims to examine whether the impact of international financial reporting standards (IFRS) on audit fees differs between early and late adopters. Design/methodology/approach The authors use robust econometric estimation on a sample of 314 firms from both early and late IFRS adopting countries. Findings The authors find that IFRS is positively and significantly associated with an increase in audit fees for early adopters, but the impact is very weak for late adopters and insignificant in some cases. The results on auditing time suggest that increase in audit fees around IFRS adoption is due to an increase in audit reporting lags. After accounting for pre- and post-years, the authors find that the relationship between IFRS and audit fees, as well as audit time for late adopters, is significant only in the adoption year. However, early adopters experience a significant increase in audit fees and audit time in the transition year to one-year post-adoption. Practical implications The findings imply that countries that are yet to adopt IFRS are less likely to experience a significant increase in audit fees audit time. Hence, is probable that the benefit of IFRS will outweigh the cost. Originality/value The results, therefore, suggest that early adopters paid a premium for been the first users of IFRS, which is consistent with any innovation. The study provides new insights by demonstrating that the consequences of IFRS differ between early and late adopters.

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Section: Introductionmentioning

confidence: 53%

Does the impact of IFRS on audit fees differ between early and late adopters?

Tawiah

2021

IJAIM

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“…Yet developing countries, particularly those in Sub-Saharan Africa, such as Nigeria, are patriarchal societies (Wadesango et al, 2011;International Finance Corporation, 2019), where men still dominate decision-making at both domestic and organisational levels. More importantly, African countries have weak legal and institutional frameworks (Chijoke-Mgbame and Mgbame, 2018; Nakpodia et al, 2018); Agyei-Boapeah et al (2020), with no explicit gender equality provision for corporate activities. Both formal (i.e., legal and regulatory) and informal (i.e., culture) institutions in Sub-Saharan Africa are weak and under-developed due to political instability, poor political leadership, conflicts and wars (United Nations Economic Commission for Africa, 2009;Nakpodia et al, 2018;International Finance Corporation, 2019;Agyei-Boapeah et al, 2020).…”

Section: Introductionmentioning

confidence: 99%

“…More importantly, African countries have weak legal and institutional frameworks (Chijoke-Mgbame and Mgbame, 2018; Nakpodia et al, 2018); Agyei-Boapeah et al (2020), with no explicit gender equality provision for corporate activities. Both formal (i.e., legal and regulatory) and informal (i.e., culture) institutions in Sub-Saharan Africa are weak and under-developed due to political instability, poor political leadership, conflicts and wars (United Nations Economic Commission for Africa, 2009;Nakpodia et al, 2018;International Finance Corporation, 2019;Agyei-Boapeah et al, 2020). For example, apart from a few Sub-Saharan African countries, such as Kenya and South Africa, legal institutions rarely support women at work (Hughes et al, 2017).…”

Section: Introductionmentioning

confidence: 99%

Board gender diversity, audit committee and financial performance: evidence from Nigeria

2020

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This paper considers the effects of female representation and the proportion of female representation on corporate boards and audit committees on financial performance in an African context where institutions are weak. Employing a panel of 77 firms, our results show that female board representation exerts a positive and significant influence on firm financial performance. The study also finds that the performance effect of gender diversity is stronger for firms with two or more female directors, suggesting that building a critical mass of female representation enhances firm financial performance. Further analysis indicates that the inclusion of females on the audit committee appears to have a positive impact on firm financial performance. Our results are robust after controlling for endogeneity and the use of alternative measures of board gender diversity.

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“…In that country, the barriers to the IFRS implementation originate from the weaknesses of the institutions and instability in the country itself (Al-Htaybat, 2018), on the one hand, with the "unavailability of relevant skilled individuals to carry out accounting transactions as stated by the new standard (IFRS)" being particularly pronounced, on the other (Almubaydeen, 2020, 216; similar findings can also be found in Ballas, Skoutela, & Tzovas, 2010;Jones & Finley, 2011). Institutional barriers, as well as mistrust in the IFRS, have also been identified as the barriers to the IFRS implementation in Egypt (Elbannan, 2011) and in African countries generally (Lassou & Hopper, 2016;Tawiah, 2019;Agyei-Boapeah, Machokoto, Amankwah-Amoah, Tunyi & Fosu, 2020).…”

Section: Resultsmentioning

confidence: 92%

Are IFRS acceptable for a developing country with specific business culture: Sudanese accountants' attitudes

Spasić¹,

Abouagla²,

Sekerez³

2021

Ekon horizonti

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Developing countries are faced with a lot of challenges in providing high-quality financial reports based on modern accounting regulations and practices. With its specific colonial and postcolonial history of socioeconomic relations, Sudan is one of a few countries that has not adopted the International Financial Reporting Standards (IFRS) either as a mandatory or as a voluntary financial reporting framework. Focusing on a sample of 142 respondents, the attitudes towards the obstacles and possible benefits of introducing the IFRS in Sudan expressed by accountants working in the industry sector are examined in the paper. This research study has shown that Sudanese accountants are highly aware of the needs and benefits of the IFRS adoption. The respondents predominantly agree that the IFRS adoption would increase the FDI inflow, reduce frauds and other unlawful activities, and improve the comparability, reliability and transparency of financial information, which currently is not the case. However, the research shows that accountants in Sudan also express a high degree of skepticism, given the numerous restrictions that they believe would make the introduction of the IFRS more difficult.

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IFRS adoption and firm value: African evidence

Cited by 35 publications

References 45 publications

Does the impact of IFRS on audit fees differ between early and late adopters?

Does the impact of IFRS on audit fees differ between early and late adopters?

Board gender diversity, audit committee and financial performance: evidence from Nigeria

Are IFRS acceptable for a developing country with specific business culture: Sudanese accountants' attitudes

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