Implementation of International Financial Reporting Standards and the Quality of Financial Statement Information
Abstract
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This study investigates the impact of the implementation of the International Financial Reporting Standards (IFRSs) on key financial measures of UK firms. The study also examines the volatility effects of IFRS implementation, the earnings management potential under IFRSs and the value relevance of IFRS-based financial statement information. The findings show that IFRS implementation has favourably affected the financial performance (e.g. profitability and growth potential) of firms. The study provides evidence that following the fair value orientation of IFRSs, the transition to IFRSs appears to introduce volatility in key income statement and balance sheet figures. The study also demonstrates that IFRS adoption reduces the scope for earnings management and leads to more value relevant accounting measures. |
| Contact information: |
| Paolo Perego |
