"Measuring The Effects Of Ifrs Adoption In Romania On Thevalue Relevance Of Accounting Data "

Abstract

In Romania, the entities listed on a regulated market must prepare their individual financial statements in accordance with the International Financial Reporting Standards (IFRS) starting with the financial year 2012. Since the IFRSs are considered high-quality accounting standards, IFRS adoption should lead to improvement of the quality of financial reporting. In this paper, we analyze the effect of mandatory IFRS introduction in Romania on accounting quality. Our main objective is to empirically test whether IFRS adoption in Romania increases the quality of accounting data reported by Romanian entities listed on Bucharest Stock Exchange. The results of our analysis conducted over the years 2010-2013 suggest that IFRS adoption in Romania generates an enhancement of accounting quality, registered especially in the case of information about the book value of equity.

The impact of IFRS adoption on the value relevance of accounting information in Saudi Arabia

“…This is because the impact of IFRS is confined to only BVPS, which does not qualify to be considered as a significant impact on the overall value relevance of accounting information since EPS was not affected significantly by the adoption. This finding is consistent with prior research (Hung and Subramanyam, 2007;Gjerde et al, 2008;Oliveira et al, 2010;Tsalavoutas et al, 2012;Kargın, 2013;Pȃs ¸can, 2014;Kaushalya and Kehelwalatenna, 2020), which has found that improvement in the value relevance is confined to BVE after IFRS adoption, and attributing this improvement to the fair value measurement principle in IFRS.…”

Value relevance of earnings and book values during IFRS convergence period in India

“…Various studies from European countries (Jermakowicz et al, 2007) and (Hung and Subramanyam, 2007) found that after enforcing new accounting standards (IFRS), value relevance of earnings and book value per share increased. These outcomes are similar with the results of (Suadiye, 2012;Pascan, 2014;Agostino et al, 2011;Jermakowicz, 2004) but different from the outcomes of (Hung and Value relevance of earnings and book values Subramanyam, 2007). (Inder and Myung-Sun, 2003) in his investigation concluded that the accounting information is value relevant if it facilitates the decision-making process by capital providers and it should produce a valid perspective of the financial statements.…”

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

“…A study by Jermakowicz et al (2007) found that after switching to new accounting standards, value relevance of earnings per share and book value per share increased. The findings are consistent with the findings of Suadiye (2012), Pascan (2014), Agostino, Drago, and Silipo (2011), Jermakowicz (2004) but are inconsistent with the findings of Hung and Subramanyam (2007). Considering another country, Filip and Raffournier’s study in Romania (as cited by Mulenga, 2016) found an increase in the value relevance of earnings per share post-IFRS adoption.…”

“…Empirical works reviewed in this study also report mixed results. On the positive side, Jermakowicz et al (2007), Bartov et al (2005), Hung and Subramanyam (2007) in Germany and (Pascan, 2014) in Romania found that accounting information is relevant after switching to IFRS, which is consistent with the findings of other researchers from Asia (Benyasrisawat, 2011; Bingbin et al, 2015; Kadri et al, 2011; Kristanto, 2015; Kwon, 2010; Liu & Liu, 2007); from Australia (Chua et al, 2012); from Africa (Adebimpe & Ekwere, 2015; Muhibudeen, 2015; Olugbenga, 2016). On the negative side, Paananen and Lin (2009), Karampinis and Hevas (2011), Kousenidis et al (2010), Bilgic and Ibis (2013), Karğın (2013) in Greece reported the decrease in the quality of accounting information after IFRS adoption, which is consistent with the findings of other researchers from Asia continent (Eccher & Healy, 2000; Haw et al, 1999; Lin & Chen, 2005) who found that Chinese GAAP is more relevant.…”