Fair value measurement disclosures in practice of companies listed at London Stock Exchange and Deutsche Börse
Part of : WSEAS transactions on business and economics ; Vol.10, No.3, 2013, pages 219-228
Issue:
Pages:
219-228
Abstract:
The financial reporting process generating information which is useful in relation to user needs helps companies in becoming more competitive within both the local and global environment. Paper contributes to the body of literature dealing with financial reporting disclosure practices: there is studied the issue of disclosures on fair value measurements in the financial statements. The employed research design imposes the construction of a guide of best practices that is further used in computing a disclosure index. Based on a sample of companies belonging to the financial sector we analyze to which extent they disclose information on fair value measurements used in financial reporting. In order to achieve the objective of this study there was calculated a firm-based disclosure score called a disclosure index. Descriptive analysis and potential correlation between this index and the use of fair value for financial reporting valuations are further investigated. When aiming to clarify professional ethics, we closely analyze integrity based on the latest developments undertaken by European professional bodies. Findings are used in identifying ways to contribute to the endeavor of aligning the profession’s performance with society’s reasonable expectations.
Subject (LC):
Keywords:
financial reporting, measurement, fair value, disclosure index, IFRS 7, professional ethics
Notes:
Περιέχει πίνακες και βιβλιογραφία
References (1):
- 1] W. Beaver, Financial Reporting: AnAccounting Revolution. 3rd Edition, PrenticeHall,1998.[2] J. Belás, and E. Cipovová, Experimentalverification of the quality and accuracy ofnternal rating model of the commercial bank.Proceedings of the 1st WSEAS InternationalConference on Economics, Political and LawScience (EPLS´12), Tomas Bata University inZlin, Czech Republic, September 20-22, 2012pp. 305-310.[3] J. E. Core, A Review of the EmpiricalDisclosure Literature: Discussion, Journal ofAccounting and Economics, No. 31, 2001, pp.441-456.[4] P. Dumontier, and B. Raffournier, Vingt ans derecherche positive en comptabilité financière,Comptabilité Contrôle Audit, numéro spécial,1999, pp. 179-197.[5] S. Fekete, D. Matis, and J. Lukacs, FactorsInfluencing the Extent of CorporateCompliance with IFRS: The Case ofHungarian Listed Companies, 2008, Availableonline:http://www.oeconomica.uab.ro/upload/lucrari/1020081/2.pdf.[6] J. Firich, Futures Trading Based on MarketProfile Day Timeframe Structures, Proceedingsof the 1st WSEAS International Conference onFinance, Accounting and Auditing, Zlin, 2012,pp. 80-85.[7] M. Glaum, and D.L. Street, Compliance withthe Disclosure Requirements of Germany'sNew Market: IAS versus US GAAP, Journal ofInternational Financial Management andAccounting, Vol. 14, 2003, pp. 64-100.[8] P.M. Healy, and K.G. Palepu, InformationAsymmetry, Corporate Disclosure, and theCapital Markets: A Review of the EmpiricalDisclosure Literature, Journal of Accountingand Economics, No. 31, 2001, pp. 405-440.[9] M.H. Lang, and R.J. Lundholm, CorporateDisclosure Policy and Analyst Behavior, TheAccounting Review, Vol. 71, No. 4, 1996, pp.467-492.[10] D. Matis, M.I. Damian, and C.G. Bonaci, FairValue Measurement Disclosures: FromTheoretical Best Practice To EmpiricallyDocumented Determinants, working papersubmitted for the International WorkshopChallenges of Contemporary Knowledge-basedEconomy, Alba-Iulia, 2012.[11] L. Smrčka, and M. Arltová, Increasing Threatof a “Total Financial Crisis” in the UpcomingYears, International Journal of MathematicalModels and Methods in Applied Science, Vol.6, No. 6, 2012, pp. 782-790.[12] J. Strouhal, C. Bonaci, N. Pasca, and J.Bokšová, Fair Value Accounting: PoliticalObstacles? International Journal ofMathematical Models and Methods in AppliedSciences, Vol. 5, No. 6, 2011, pp. 1019-1026.
