 Does OCI Presentation for Equity Financial Assets Matter?Zeting Zang, Humayun Kabir and Tom Scott Australian Accounting Review, 2022, vol. 32, issue 4, 427-439 Abstract: One significant change in International Financial Reporting Standard (IFRS) 9 Financial Instruments is how firms’ equity financial assets (EFA) are presented. The default EFA presentation is at fair value through profit or loss (FVTPL); however, IFRS 9 allows irrevocable presentation of fair value through other comprehensive income (FVTOCI). Although FVTOCI is the most common presentation for EFA both before and after IFRS 9, there is a significant increase in the use of FVTPL post IFRS 9 via an improvement in disclosure clarity about presentation location. To assess the impact of EFA presentation, we recalculate profitability ratios assuming different presentation locations and find some evidence of significant differences for financial firms. We also provide descriptive evidence that EFA use and presentation behaviour vary between sectors and firm size quartiles. This study expands the literature on EFA accounting and provides a timely response to IFRS 9 post‐implementation review by shedding some light on EFA use and presentation locations under IFRS 9. Date: 2022 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:ausact:v:32:y:2022:i:4:p:427-439 Ordering information: This journal article can be ordered from Access Statistics for this article Australian Accounting Review is currently edited by Linda M. English More articles in Australian Accounting Review from CPA Australia |
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