Being able to separate temporary global macroeconomic influences - caused by fluctuations in exchange rates, interest rates and inflation - from intrinsic performance - related to a superior product, production process or management - is crucial to the assessment of the development of a firm’s...

This paper hypothesizes that a country's political system bears on the decision to adopt International Financial Reporting Standards (IFRS). To the extent that accounting standards influence economic behavior, a sweeping change in accounting standards is likely to upset the balance of power...

We investigate the effect of standard setters in standard setting: We examine how certain professional and political characteristics of FASB members and SEC commissioners predict the accounting “reliability” and “relevance” of proposed standards. Notably, we find FASB members with...

The development of the capital markets increases the key role of the financial manager both in using the new techniques for administrating the risks and in assessing hedge effectiveness. Risk means possible uncertainty regarding cash flows, influencing the fair value of assets and liabilities or...

I examine how IFRS 17 Insurance Contracts affects the firm value of insurers reporting under IFRS (“IFRS insurers”). Studying 427 insurers' stock returns around sixteen events affecting the chance that IFRS 17 passes, I find that the introduction of IFRS 17 is on average associated with...

According to IFRS 9, an Entity shall assess – by performing a quantitative assessment – the relevance of the modification of the time value of money element, i.e. the modification of the interest that can be observed, e.g. in all the instruments whose underlying interest rate tenors are...

This paper tests whether the adoption of International Financial Reporting Standards (IFRS) reduces the cost of adverse selection. We find that adverse selection costs fall only for firms that adopt IFRS before the mandated date. We also find that firms in countries with well-developed local...

We regard accounting regulation as a politico-economic institution and analyze its evolution in the presence of changing investor sentiment. When the market sentiment is moderate, if most of the business projects in the economy are successful, the economy will enter a stable high-disclosure...

We analyze a choice that parent firms face under IFRS: whether to account a business combination under a common control (BCUCC) at fair value or at the historical cost, to provide evidence that firms would use fair value when they believe it would help them issuing public debt. A BCUCC is a...

This paper examines the liquidity, Tobin's Q, and cost of equity effects from voluntary and mandatory IFRS adoption. In contrast to prior work, we focus on the firm level heterogeneity in the economic consequences, recognising that the level of uncertainty avoidance (UAI) in a country will...