International GAAP Differences - The Impact on Foreign Analysts

Bae, Kee‐Hong; Tan, Hongping; Welker, Michael

doi:10.2139/ssrn.873600

Cited by 195 publications

(362 citation statements)

References 33 publications

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“…Arguably, the mandatory switch to IFRS in countries with larger differences between domestic accounting standards and IFRS should result in greater improvements in comparability and financial reporting quality and therefore should be related with larger debt market benefits. Following prior literature (e.g., Daske et al 2008;Ball et al 2014), we capture the degree to which the accounting rules change with the switch to IFRS by using the summary score Gaapdiff from Bae et al (2008). Based on the Nobes (2001) GAAP 2001 Survey, Bae et al (2008) construct country scores of discrepancies between local GAAP and International Accounting Standards (IAS) relating to 21 key accounting items; higher values reflect larger accounting differences.…”

Section: Differences Between Local Gaap and Ifrsmentioning

confidence: 99%

“…Following prior literature (e.g., Daske et al 2008;Ball et al 2014), we capture the degree to which the accounting rules change with the switch to IFRS by using the summary score Gaapdiff from Bae et al (2008). Based on the Nobes (2001) GAAP 2001 Survey, Bae et al (2008) construct country scores of discrepancies between local GAAP and International Accounting Standards (IAS) relating to 21 key accounting items; higher values reflect larger accounting differences. As shown in panel A, this factor is missing only for Bermuda.…”

Section: Differences Between Local Gaap and Ifrsmentioning

confidence: 99%

“…24 To mitigate concerns that the reported beneficial debt market changes around the IFRS mandate are associated with concurrent institutional reforms in the European Union, we perform the following tests. Bae et al (2008) and is a summary score of how domestic GAAP differ from IAS on 21 key accounting items; higher values represent more discrepancies between local GAAP and IFRS. Enforcement equals 1 for EU countries that introduced proactive reviews at the same time as mandatory IFRS adoption; these countries include Finland, Germany, Netherlands, Norway, and the U.K .…”

Section: Concurrent Institutional Changes In the European Unionmentioning

confidence: 99%

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Does mandatory IFRS adoption facilitate debt financing?

2015

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We examine whether the mandated introduction of International Financial Reporting Standards (IFRS) is associated with the propensity to access the public rather than private debt market and the cost of debt. We use a global sample of public bonds and private loans and find that mandatory IFRS adopters are more likely, post-IFRS, to issue bonds than to borrow privately. We also find that mandatory IFRS adopters pay lower bond yield spreads, but not lower loan spreads, after the mandate. These findings are consistent with debt providers responding positively to financial reporting of higher quality and comparability, but only when there is a greater reliance on publicly available financial statements than private communication. Lastly, we document that the observed debt market benefits are concentrated in countries with larger differences between domestic GAAP and IFRS and are present even for EU countries that did not experience concurrent financial reporting enforcement or other institutional reforms. Overall, our study documents positive economic consequences around the mandated IFRS adoption for corporate debt financing and, in particular, for bond financing.Keywords Accounting regulation Á IFRS Á Accounting quality Á Public and private debt markets Á Cost of debt

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Section: Differences Between Local Gaap and Ifrsmentioning

confidence: 99%

Section: Differences Between Local Gaap and Ifrsmentioning

confidence: 99%

Section: Concurrent Institutional Changes In the European Unionmentioning

confidence: 99%

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Does mandatory IFRS adoption facilitate debt financing?

2015

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“…Even in the EU, there are considerable accounting differences between member states. For example, Bae et al (2008) have analyzed international GAAP accounting differences and its impact on foreign analysts. They identify 21 items that are subject to different accounting treatments between local standards and IAS in 2001, including tax accounting (item 2), lease (item 4), goodwill (item 8), fair value (item 11), and R and D (item 17).…”

Section: The Effect Of Ifrs and Culture On Earnings Managementmentioning

confidence: 99%

Earnings Management in Europe Post IFRS: Do Cultural Influences Persist?

et al. 2015

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We investigate the extent to which the mandatory adoption of International Financial Reporting Standards (IFRS) has restricted the previously documented association between national culture and international differences in earnings management practices. We analyze the earnings management behavior of publicly listed firms in 14 member countries of the European Union during the period 2000-2010. Our findings show that the tendency to engage in earnings management continues post IFRS and that cultural factors remain influential in explaining differences in the magnitude of earnings management behavior across countries.

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“…The study has a sample size (purposive sampling) of 58 respondents comprising top level authorities of listed companies. The respondents include Chairman (4),CEO/MD(7),CFO (17),Executive Director(9), Independent Director(10) and Auditors (11).The industry profile of sample respondents include Chemical, Fertiliser, Petroleum and Refining, Information Technology, Electrical and Electronics and Banking and Insurance. Secondary data was also used for the study.…”

Section: Methodsologymentioning

confidence: 99%

Corporate Governance Practices of Listed Companies in India

Suresh¹

2012

IOSRJBM

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International GAAP Differences - The Impact on Foreign Analysts

Cited by 195 publications

References 33 publications

Does mandatory IFRS adoption facilitate debt financing?

Does mandatory IFRS adoption facilitate debt financing?

Earnings Management in Europe Post IFRS: Do Cultural Influences Persist?

Corporate Governance Practices of Listed Companies in India

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