The Impact of K-IFRS Adoption on the Value Relevance of Accounting Information
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초록
This study investigates the impact that IFRS adoption in Korea has had on the value relevance of accounting information. The hypothesis is that under the new set of accounting standards (IFRS-based accounting standards named K-IFRS in Korea), the quality of book value and earnings reported by these companies is relatively higher. To this end, the quality of accounting information proxy is studied using the value relevance of book value and earnings. 10,720 firm-year observations are obtained for a five-year period before and a five-year period after the adoption of K-IFRS, and the results indicate that the adoption of K-IFRS is related to a higher reported book value and earnings quality. The results show that the value relevance of the firms’ book value and earnings is significantly higher after the adoption of K-IFRS. This study reinforces the notion that introducing IFRS improves the usefulness of accounting information and further indicates that IFRS adoption can ensure consistency in Korea of international accounting standards to improve the credibility of accounting information. As such, this research has directly addressed the impact of IFRS adoption on the quality of financial reporting in an emerging market.
Abstract
This study investigates the impact that IFRS adoption in Korea has had on the value relevance of accounting information. The hypothesis is that under the new set of accounting standards (IFRS-based accounting standards named K-IFRS in Korea), the quality of book value and earnings reported by these companies is relatively higher. To this end, the quality of accounting information proxy is studied using the value relevance of book value and earnings. 10,720 firm-year observations are obtained for a five-year period before and a five-year period after the adoption of K-IFRS, and the results indicate that the adoption of K-IFRS is related to a higher reported book value and earnings quality. The results show that the value relevance of the firms’ book value and earnings is significantly higher after the adoption of K-IFRS. This study reinforces the notion that introducing IFRS improves the usefulness of accounting information and further indicates that IFRS adoption can ensure consistency in Korea of international accounting standards to improve the credibility of accounting information. As such, this research has directly addressed the impact of IFRS adoption on the quality of financial reporting in an emerging market.
참고문헌 (20)
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