1、1 中文 4178 字 外 文 翻 译 外文题目 Investigating the Effects of the EU Mandatory Adoption of IFRS on Accounting Quality: Evidence from Italy 外文出处 International Journal of Business and Management 外文作者 Paola Paglietti 原文 ： Investigating the Effects of the EU Mandatory Adoption of IFRS on Accounting Quality: Evi
2、dence from Italy Abstract The European Community Regulation No. 1606/2002 required all EU listed companies to prepare their consolidated financial statements in accordance with IFRS as from 1 January 2005. This paper studies the impact of the IFRS mandatory adoption in a typical code-law European co
3、untry such as Italy. It aims to investigate how and whether the accounting information quality changes following IFRS implementation. The focus is on value relevance which is considered as one of the basic attributes of accounting quality. An empirical analysis is performed on a sample of 960 firm-y
4、ear observations concerning Italian listed companies observed from 2002 to 2007. Results confirm the expected overall increase in the value relevance under IFRS. The research also documents changes in Italys country-specific factors in the period surrounding IFRS adoption that may contribute to an i
5、mprovement in accounting quality. Such a concern is consistent with previous literature supporting the idea that accounting quality does not depend only on the high quality of accounting standards, but it is also a function of the countrys complex institutional setting. Introduction In 2002, the Par
6、liament and the Council of the European Union (EU) approved a 2 Regulation (No. 1606/2002) requiring all listed companies in the EU to use the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) for the preparation of their consolidated fi
7、nancial statements from 1 January 2005 onwards. Member states have the option to extend this requirement to individual company accounts and to consolidated accounts of non-listed companies. (Note 1) One of IASBs main goals is to develop a single set of accounting standards that, if followed, require
8、s companies to report “high quality, transparent and comparable information in financial statements”. (Note 2) Evidence of higher accounting quality has been interpreted by Barth, Landsman and Lang (2008) for the IFRS-adopting firms who exhibit less earnings management, more timely loss recognition
9、and more value relevance of earnings, based on a worldwide sample. Such concerns lead to the expectation that the IFRS mandatory adoption in Europe should determine important economic consequences for financial reporting. The present study focuses on Italy, a typical European code-law country that h
10、as been experiencing the IFRS mandatory adoption. It aims to investigate the effect of the IFRS adoption on the accounting information quality. Since accounting quality is a broad concept with multiple dimensions (Burgstahler, Luzi, & Leuz, 2006), this study focuses on the value relevance which is c
11、onsidered one of the basic attributes of accounting quality (Francis, LaFond, Olsson, & Schipper, 2004). Value relevance expresses the ability of financial statement information to capture or summarize information that affects share values and it is indicated by the statistical association between a
12、ccounting information and market prices or returns (Francis & Schipper, 1999, pp. 326-327). By using consolidated financial statement data from a sample of 960 firm-year observations concerning 160 Italian listed companies observed from 2002 to 2007, the value relevance in Italy is investigated to a
13、nswer the first research question: Does the value relevance of earnings and book value of equity systematically change in Italy with the mandatory adoption of IFRS? For this purpose, the combined, relative and incremental value relevance of book value of equity and earnings with respect to share pri
14、ces are examined. In addition, the value relevance of earnings levels and 3 earnings changes is investigated for the period 2002-07 using the return regression model. To test for a systematic change in the statistical association between stock prices/returns and accounting numbers induced by adoptin
15、g IFRS, pooled regressions comparing value relevance in the pre-adoption period (i.e, from 2002 to 2004) with the post-adoption one (i.e, in the three-year period 2005-2007) are estimated. Data are also analyzed on a sectoral basis to answer the second research question: How does the IFRS adoption i
16、mpact the value relevance in the different sectors? To respond to this the same set of association studies are performed separately for firms operating in the Finance, Industry and Services macro-sectors to study cross-sectional differences in the value relevance. Italy was chosen as the subject of
17、this research because the countrys institutional structure should enable the detection of early evidence of the impact of IFRS mandatory adoption at country level. Firstly, Italy has a “civil law-based” legal system in which the rules governing accounting are the product of the lawmakers and their p
18、olitical superiors (Di Pietra, McLeay, & Riccaboni, 2001). Accounting standards set by the national professional body have always only played an interpretative role of the legal rules and they have never been officially recognized as law. Their ambiguous status has influenced their scarce applicatio
19、n and recognition by professionals and companies (Zambon, 2001). Secondly, the Italian accounting rules show significant differences from IFRS. They have been driven by emphasis on the financial statement conformity with tax regulations, conservatism, and broad-stakeholder orientation. Conversely, I
20、FRS have a stronger economic and business orientation, with a particular focus on the information needs of capital markets. Another reason why Italy is an interesting case study is the choice of the national legislator to require the use of IFRS also in individual accounts of listed companies, thus
21、taking a different orientation compared to most Continental European countries where this use has been left as an option. Such an extension should strengthen IFRS enforcement by making accounting numbers of consolidated financial statements more reliable for empirical analysis. At any rate, it is worth noticing that positive effects of IFRS adoption on
