Is IFRS 9 better than IAS 39 for investors? decisions? Evidence from the European context at the beginning of the transition year

Alessandro Mechelli, Vincenzo Sforza and Riccardo Cimini

FINANCIAL REPORTING, 2020, vol. 2020/1, issue 1, 125-148

Abstract: The first-time adoption of International Financial Reporting Standard (IFRS) 9 at the beginning of fiscal year 2018 has offered the opportunity to test whether the information provided by this new accounting standard on financial instruments is more useful for investors than International Accounting Standard (IAS) 39. This paper assesses and compares the value relevance of book value calculated ac-cording to the requirements of the two accounting standards on financial instru-ments at the beginning of the transition year for a sample of 110 financial entities listed in 20 stock markets that have recorded transition effects between retained earnings. Findings provide evidence that both IAS 39 and IFRS 9 are value rele-vant and that the second one adds more information than that previously supplied by the first one. The paper contributes to the literature by providing the first evi-dence of the usefulness of the new accounting standard on financial instruments. About its practical implications, the paper provides insights regarding the high quality of the International Accounting Standard Board (IASB)?s standard setting process.

JEL-codes: M40 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.francoangeli.it/riviste/Scheda_Rivista. ... 438&Tipo=ArticoloPDF (text/html)
Single articles can be downloaded buying download credits, for info: https://www.francoangeli.it/DownloadCredit

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fan:frfrfr:v:html10.3280/fr2020-001004

Ordering information: This journal article can be ordered from
http://www.francoang ... o.aspx?IDRivista=163

Access Statistics for this article

FINANCIAL REPORTING is currently edited by FrancoAngeli

More articles in FINANCIAL REPORTING from FrancoAngeli Editore
Bibliographic data for series maintained by Stefania Rosato ().