Compliance with IFRS 3 and IAS 36 Required Disclosures across 17 European Countries: Company-Level and Country-Level Determinants

Accounting and Business Research, Forthcoming

Posted: 28 Aug 2012 Last revised: 21 Sep 2012

See all articles by Martin Glaum

Martin Glaum

WHU - Otto Beisheim School of Management

Peter Schmidt

Justus-Liebig-University Giessen, Germany, and Higher School of Economics (HSE) Moscow, Russia

Donna L. Street

University of Dayton - Accounting

Silvia Vogel

Justus-Liebig-University Giessen

Date Written: August 28, 2012

Abstract

In this study, we analyse compliance for a large sample of European companies mandatorily applying International Financial Reporting Standards (IFRS). Focusing on disclosures required by IFRS 3 Business Combinations and IAS 36 Impairment of Assets, we find substantial non-compliance. Compliance levels are determined jointly by company- and country-level variables, indicating that accounting traditions and other country-specific factors continue to play a role despite the use of common reporting standards under IFRS. At company level, we identify the importance of goodwill positions, prior experience with IFRS, type of auditor, the existence of audit committees, the issuance of equity shares or bonds in the reporting period or in the subsequent period, ownership structure and the financial services industry as influential factors. At country level, the strength of the enforcement system and the size of the national stock market are associated with compliance. Both factors not only directly influence compliance but also moderate and mediate some company-level factors. Finally, national culture in the form of the strength of national traditions (‘conservation’) also influences compliance, in combination with company-level factors.

Keywords: IFRS, compliance, business combinations, cross-national analysis, goodwill, impairment testing, IFRS 3, IAS 36

JEL Classification: M41, G34, K42

Suggested Citation

Glaum, Martin and Schmidt, Peter and Street, Donna L. and Vogel, Silvia, Compliance with IFRS 3 and IAS 36 Required Disclosures across 17 European Countries: Company-Level and Country-Level Determinants (August 28, 2012). Accounting and Business Research, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2137676

Martin Glaum (Contact Author)

WHU - Otto Beisheim School of Management ( email )

Burgplatz 2
D-56179 Vallendar
Germany
+49 261 - 6509-315 (Phone)

Peter Schmidt

Justus-Liebig-University Giessen, Germany, and Higher School of Economics (HSE) Moscow, Russia ( email )

Giessen
Germany

Donna L. Street

University of Dayton - Accounting ( email )

Dayton, OH 45469
United States

Silvia Vogel

Justus-Liebig-University Giessen ( email )

giessen
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
2,235
PlumX Metrics