Quality of IFRS Reporting: Developed, Transitional, and Developing Economies

Patrik Svoboda () and Hana Bohušová ()
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Patrik Svoboda: Mendel University in Brno
Hana Bohušová: AMBIS University

Chapter Chapter 19 in Applied Economic Research and Trends, 2024, pp 321-335 from Springer

Abstract: Abstract This study aims to assess how listed companies in developed, transition, and developing countries comply with selected mandatory disclosure requirements under International Accounting Standards (IAS)/International Financial Reporting Standards (IFRS). Through methods for quantifying the quality of financial reporting as measured by the level of compliance with selected IAS/IFRS, particularly in the notes, the chapter aims to compare the quality of reporting in countries representative of these groups. To measure compliance with IAS/IFRS, the annual reports of non-financial companies traded on stock exchanges were examined. Cooke’s (Account Bus Res 22:229–237, 1992) unweighted disclosure index (DI) was used. For the evaluation, selected standards used by all types of companies regardless of sector (IAS1, 2, 8, 10, 12, 16, 36, 37, 38, and 40) have been used. Compatibility assessments were also conducted within the selected industries. The main finding of our research was the relatively low difference in the quality of IAS/IFRS reporting between the countries studied. The average DI for Czech companies is 87.89%, 93.17%, and 83.52% for German and Ghanaian companies, respectively. The lowest DI levels are represented by IAS37 and IAS16, while the highest DI qualities are represented by IAS10 and IAS8. The findings from the survey conducted could serve existing and potential investors, as well as other users such as providers of loan capital, for their decision-making.

Keywords: IFRS; Reporting; Notes; Disclosure index; Dichotomous method; Stock exchange (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-031-49105-4_19

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DOI: 10.1007/978-3-031-49105-4_19

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