Value Allocation – Contribution and Risk to the Reliability of Financial Reporting

Deaconu, Adela; Crisan, Sorana; Buiga, Anuţa

doi:10.15240/tul/001/2016-2-007

Cited by 7 publications

(8 citation statements)

References 14 publications

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“…Financial results have recently been studied together with linguistic information to achieve more accurate financial decision-making models (Loughran & McDonald, 2011;Davis et al, 2012;Engelberg et al, 2012;Zuchewicz, 2012;Deaconu et al, 2016;Achim, 2016). Thus, financial performance can be examined in relation to managerial behaviour (Merkl-Davies et al, 2011) and the expected reactions of stakeholders (Yekini, Wisniewski, & Yuval, 2016).…”

Section: Literature Reviewmentioning

confidence: 99%

Comprehensive assessment of firm financial performance using financial ratios and linguistic analysis of annual reports

Myšková¹,

Hájek²

2017

Journal of International Studies

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Abstract. Indicators of financial performance, especially financial ratio analysis, have become important financial decision-support information used by firm management and other stakeholders to assess financial stability and growth potential. However, additional information may be hidden in management communication. The article deals with the analysis of the annual reports of U.S. firms from both points of view, a financial one based on a set of financial ratios, and a linguistic one based on the analysis of other information presented by firms in their annual reports. Spearman correlation coefficient is used to compare the values of financial and linguistic indicators. For the purpose of the comprehensive assessment, novel word lists are proposed, specifically designed for each category of financial analysis. The aim is to assess the information ability of annual reports and whether successful firms present their results precisely or not. The results show that the proposed topic dictionaries can be beneficial, especially for the assessment of cash flow and leverage ratios.

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Section: Literature Reviewmentioning

confidence: 99%

Comprehensive assessment of firm financial performance using financial ratios and linguistic analysis of annual reports

Myšková¹,

Hájek²

2017

Journal of International Studies

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“…cash and bank accounts, cheques, bank loans and trade payables and receivables. Deaconu et al (2016) show in their study that a frequent use of replacement cost, gross or net, negatively affects the book value.…”

Section: Other Aspects Affecting the Quality Of Accounting Informationmentioning

confidence: 96%

Problematic Areas of Accounting: Some Evidence From the Czech Republic

Paseková¹,

Svitáková²,

Kramná³

et al. 2018

JOC

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Accounting is a tool of evidence for reporting assets, equities, liabilities, expenses, revenues and profits or losses of the accounting unit. This information is collectively presented in financial statements, which are an essential source of information for external subjects. Nevertheless, the resulting financial statements are relevant only to the extent to which the information charged in the accounting is correct and error-free. For this reason, the aim of this article is to examine the individual areas recorded in accounting in terms of their possible bias due to an error. The objective of this article is to determine which of the areas of accounting are riskiest in relation to the occurrence of errors, and this in connection to the existence of an important foreign partner of the accounting unit. The risk of of the error occurrence is examined from the accountants' perspective. For this purpose, a questionnaire survey was used for data collection focusing on areas that are considered to be the most important by the accountants and the areas which are the most problematic. The receivables, expenses and revenues were indicated as the most significant. The areas of long-term assets, financial assets and inventories appear to be problematic due to tax impacts. Expenses, revenues, accruals and deferrals appear to be problematic due to issues with correct valuation. The difference in perception of risk of the error occurrence in relation to the existence of a foreign business partner was proven only for some accounting areas such as liabilities, inventories or expenses.

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“…cash and bank accounts, cheques, bank loans and trade payables and receivables. Deaconu, Crisan & Buiga (2016) show frequent use of replacement cost, gross or net, to the detriment of book value in their study.…”

Section: Aspects Affecting the Quality Of Accounting Informationmentioning

confidence: 99%

Towards Financial Sustainability of Companies: Issues Related to Reporting Errors

Paseková¹,

Svitáková²,

Kramá³

et al. 2017

JSSI

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The aim of the paper is to analyse the opinion of enterprise representatives upon the risk of errors occurrence in selected areas of accounting. Research presented in this paper explains the view of enterprise accountants upon the risk of errors occurrence, both unintentional and intentional, aimed towards the creation of so called "creative accounting". The research itself, done on a sample of 232 Czech enterprises, was based on questionnaire investigation which focused on perception of problematic areas influencing the quality of accounting information. The obtained set of data was evaluated using descriptive method and mathematical/inference statistics. Special testing was done at hypotheses on concordance of two mean values and at the Friedman test. Evaluation of problematic rates of individual areas of accounting revealed that practically each observed area of accounting is connected with specific difficulties. The major causes of problems are tax impacts, namely in the area of the cost, time differentiation and of revenues and also difficulty in pricing, especially in the area of inventories and fixed and financial assets. High respondents´ concordance on rating individual accounting areas as to the risk of an error occurrence was detected. It stemmed from the research that the risk of formation of unintentional errors is subjectively rated as the highest in the areas of conjectural and adjusting items and the lowest at asset and depreciation classification. Rating the space for intentional distortion of accounting statements indicates a very reserved attitude of the respondents. The results have proved that in the respondents´ opinion practically all areas of accounting give space for occurrence of errors. The results of the research provided a somewhat different perspective on the issue of accounting errors in comparison with results published by other authors who used objective assessment of error rate as a departure point.

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Value Allocation – Contribution and Risk to the Reliability of Financial Reporting

Cited by 7 publications

References 14 publications

Comprehensive assessment of firm financial performance using financial ratios and linguistic analysis of annual reports

Comprehensive assessment of firm financial performance using financial ratios and linguistic analysis of annual reports

Problematic Areas of Accounting: Some Evidence From the Czech Republic

Towards Financial Sustainability of Companies: Issues Related to Reporting Errors

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