合并报表与母公司报表的有用性:理论分析与经验检验

本文从我国要求母公司同时编制和提供合并报表和母公司报表这一制度安排出发,检验了合并报表和母公司报表的有用性。研究得出,按照现行会计制度编制的合并报表在预测集团经营成果和现金流量方面并没有显著优于母公司报表。在分析上市公司的综合财务状况和偿债能力方面,母公司报表可以提供显著的增量信息。     

Are IFRS and U.S. GAAP converging? : Some evidence from People's Republic of China companies listed on the New York Stock Exchange

This research investigates the comparability and convergence of two sets of accounting standards from 1996 to 2002: United States’ Generally Accepted Accounting Principles (U.S. GAAP) and International Financial Reporting Standards (IFRS). The investigation involves a sample of companies from the People's Republic of China (PRC) that are listed on the New York Stock Exchange (NYSE). PRC companies traded on the NYSE generally prepare IFRS financial statements and provide a limited reconciliation to U.S. GAAP, creating a unique quasi-experimental opportunity to examine differences between two sets of accounting numbers produced by two different sets of accounting standards while holding the company constant. Comparability is measured by using Gray's index of comparability, and a set of measures are introduced to capture several dimensions of convergence over time in reported net income, net assets, return on net assets, and earnings per share. The evidence shows lack of comparability, caused largely by the revaluations of property, plant and equipment permitted under IFRS, but not permitted under U.S. GAAP. There is, however, substantial evidence of convergence over time.     

Gemini Communications: A case applying revenue recognition standards

Gemini Communications (Gemini) is a case study on revenue recognition criteria. You will take on the role of an audit manager for the public accounting firm that audits Gemini. Your client, Gemini, is a US company that recently expanded operations into China through the acquisition of Apollo Man. Gemini prepares its financial statements in accordance with US Generally Accepted Accounting Principles (US GAAP) while Apollo Man prepares its financial statements in accordance with International Financial Reporting Standards (IFRS GAAP). Your assignment is to research, compare and contrast the technical criteria for revenue recognition under US GAAP, IFRS GAAP, and the proposed revenue standard. You will apply the various criteria to an Apollo Man sales transaction to determine the timing and amount of revenue Apollo Man should recognize. The case is designed to develop your research and written communication skills.     

Proportionate consolidation versus the equity method: Additional evidence on the association with bond ratings

From a financial analysis perspective, proportionate consolidation of significant influence equity investments is often presumed to provide more useful information than equity method accounting. Surprisingly, Kothavala [Kothavala, K., 2003, Proportional consolidation versus the equity method: A risk measurement perspective on reporting interests in joint ventures, Journal of Accounting and Public Policy 22, 517-538.] finds that financial statement measures based on the equity method are more relevant for bond ratings than are similar measures based on proportionate consolidation. This study provides additional evidence regarding this issue. Using a sample of manufacturing firms with significant influence equity investments accounted for under U.S. GAAP, the results indicate that pro forma proportionately consolidated financial statements have greater relevance than equity method statements for explaining bond ratings.     

母公司个别财务报表中对子公司投资的会计处理方法之辨:成本法还是权益法?

由于我国现行《长期股权投资》会计准则规定在母公司个别财务报表中采用成本法核算对子公司的长期股权投资(以下简称为对子公司投资),这割裂了母公司个别财务报表与合并财务报表的本原逻辑关联,削弱了两者间的互补性,且导致母公司股东基于母公司个别财务报表来厘定分红权利虽然符合《公司法》却很不合理,而基于合并财务报表来厘定分红权利虽更为合理但和《公司法》存在明显冲突.我们对该问题进行了深入分析,论证了在母公司个别财务报表之中采用权益法来核算其对子公司投资的逻辑合理性和现实必要性,并建议修订我国现行《长期股权投资》会计准则,在母公司个别财务报表之中由成本法改为采用权益法来核算其对子公司投资.     

The value-relevance of adopting IFRS: Evidence from 145 NGAAP restatements

Firms listed on stock exchanges within the European Economic Area are required to report consolidated financial statements according to International Financial Reporting Standards (IFRS) since 2005. The firms that adopted IFRS in 2005 were also required to restate their 2004 financial statements from national GAAP to provide comparable accounting figures. These two sets of financial statements for 2004 are thus based on identical underlying economic activities and are fully specified according to two different reporting regimes. Our sample consists of 145 restatements from Norwegian Generally Accepted Accounting Principles (NGAAP) to IFRS for firms listed on the Oslo Stock Exchange in Norway. We test whether the IFRS accounting figures correlate more strongly with stock market values than the corresponding NGAAP figures. We find little evidence of increased value-relevance after adopting IFRS when comparing and evaluating the two regimes unconditionally. On the other hand, when evaluating the change in the accounting figures from NGAAP to IFRS, we find evidence that the reconcilement adjustments to IFRS are marginally value-relevant due to increased relevance of the balance sheet and the normalized net operating income. By weighting our sample by firm size, intangible asset intensity and profitability, we learn that the increased value-relevance of the net operating income stems from different reporting of intangible assets. Since more intangible assets are capitalized according to IFRS than NGAAP, our finding is consistent with the view that capitalizing intangible assets is more value-relevant than expensing them as incurred or through goodwill amortization.     

Proportional consolidation versus the equity method: A risk measurement perspective on reporting interests in joint ventures

Under Canadian generally accepted accounting principles (GAAP), firms are required to proportionally consolidate joint venture investments, as opposed to the United States where the equity method is used. Using a sample of Canadian firms, this study investigates the relative information content of equity method and proportionally consolidated financial statement amounts for explaining market risk. This is possible for Canadian firms where detailed footnote disclosures permit the calculation of pro forma equity method amounts. The findings are surprising in that whereas proportionally consolidated financial statements are more risk relevant than equity method statements for explaining price volatility, equity method statements are more risk relevant than proportionally consolidated ones for explaining bond ratings. The findings suggest that different market participants use financial statement information differently. The study also finds that failure to disclose disaggregated joint venture accounting amounts, as is the case under US GAAP, masks information that could help market participants assess risk.     

An Investigation into the Potential Adoption of International Financial Reporting Standards in the United States: Implications and Implementation

International Financial Reporting Standards (IFRS) have been adopted by most of the G20 countries. Given the broad worldwide acceptance of IFRS and significance of attaining comparability to facilitate free flow of capital, the US standard setter, the Financial Accounting Standards Board (FASB) made a commitment to jointly work with the International Accounting Standards Board (IASB) to explore the possibilities of convergence of US Generally Accepted Accounting Principles (GAAP) with IFRS. In 2007, the US Securities and Exchange Commission (SEC) eliminated the requirement that foreign companies listed on the US stock exchanges reconcile their IFRS‐based financial statements with the US GAAP. In the same year the US SEC issued a concept release to the public requesting comments on a proposal to allow US issuers to prepare financial statements in accordance with IFRS. Following these initiatives by the FASB and SEC, the aim of the present study is to investigate the implications of a potential full adoption of IFRS by the US. The present study details the challenges and benefits of adoption and outlines the steps required for a successful outcome of this process.     

FINANCIAL TRANSACTIONS WITHIN BANK HOLDING COMPANIES

This study explores financial transactions within bank holding companies in both a theoretical and an empirical context. Empirical analysis focuses on two major types of interaffiliate financial transactions—extensions of credit and transfers of assets—between holding company banks and their nonbank affiliates (defined to include the parent company and nonbank subsidiaries of the parent) over the period 1976–1980. The data generally point to a net downstream flow of funds from the nonbank sector to the bank sector of a holding company, with the downstream fund flows particularly strong in the case of extensions of credit. In part, this result may reflect the statutory restrictions on bank lending to affiliates, particularly the collateral requirements.     

The Role and Current Status of IFRS in the Completion of National Accounting Rules – Evidence from the Netherlands

Abstract

Dutch law (B2T9) is positive towards IFRS. IFRS may be used by all entities, there is a specific option for entities using IFRS in the consolidated financial statements to apply an IFRS-friendly version of B2T9 in its separate financial statements, and IFRS for SMEs can be used by non-listed and non-regulated companies in combination with B2T9. In the process of adoption of the 2013 EU Accounting Directive only limited references have been made to IFRS. This is not an indication of a reduced interest in IFRS, but is a result of limiting the changes of B2T9 to those that are necessary as a result of changes at the EU level. The Dutch Accounting Standards Board, issuing Dutch Accounting Standards (DAS), considers IFRS when developing and changing its standards. In addition to the IFRS option DAS often include one or more additional optional treatments that are considered suitable for non-listed companies. The Dutch regulatory authority AFM is also positive towards IFRS and even advocates elimination of non-IFRS options from Dutch GAAP as much as possible. The number of major differences between Dutch GAAP and IFRS is relatively limited, with only a few differences that cannot be avoided by an entity when preparing financial statements under Dutch GAAP.     

Internal Capital Markets and Capital Structure: Bank Versus Internal Debt

We argue that domestic business groups are able to actively optimise the internal/external debt mix across their subsidiaries. Novel to the literature, we use bi‐level data (i.e. data from both individual subsidiary financial statements and consolidated group level financial statements) to model the bank and internal debt concentration of non‐financial Belgian private business group affiliates. As a benchmark, we construct a size and industry matched sample of non‐group affiliated (stand‐alone) companies. We find support for a pecking order of internal debt over bank debt at the subsidiary level which leads to a substantially lower bank debt concentration for group affiliates as compared to stand‐alone companies. The internal debt concentration of a subsidiary is mainly driven by the characteristics of the group's internal capital market. The larger its available resources, the more intra‐group debt is used while bank debt financing at the subsidiary level decreases. However, as the group's overall debt level mounts, groups increasingly locate bank borrowing in subsidiaries with low costs of external financing (i.e. large subsidiaries with important collateral assets) to limit moral hazard and dissipative costs. Overall, our results are consistent with the existence of a complex group wide optimisation process of financing costs.     

Statement of the Financial Economists Roundtable on the International Competitiveness of U.S. Capital Markets

The Committee on Capital Markets Regulation issued an Interim Report (known as the “Paulson Report”) near the end of 2006 that concluded that the U.S. “is losing its leading competitive position as compared to stock markets and financial centers abroad.” This report was quickly followed by a study, which reached similar conclusions, that was commissioned by New York Mayor Michael Bloomberg and Senator Charles Schumer and prepared by McKinsey & Co. At its July 2007 annual meeting, the Financial Economists Roundtable (FER) — a group of senior financial economists at universities and other organizations recognized as having made significant contributions to the finance literature—discussed the issues raised by the Report and decided to publish its own report. The report makes the following four policy recommendations:

• 1 Securities class action suits —Abolish enterprise liability under rule 10b‐5 in situations arising out of security purchases and sales in the secondary trading market among outside shareholders, while retaining managerial and firm liability where the company itself or its insiders (officers and directors) transact to their own benefit. Imposing massive liability on a company that is not a party to the securities transactions and does not benefit from the fraud does not serve a deterrence function since it is the continuing shareholders of the corporation who bear the burden of what the company must pay if found guilty, either directly or indirectly through insurance premiums.
• 2 Shareholder rights—Require all corporations to obtain shareholder approval to adopt a poison pill, regardless of whether a company has a staggered board. This requirement would conform to the broad principle that the board of any company should not be able to deny its shareholders the opportunity to decide on the merits of a takeover bid, and it would help restore the market for corporate control as an effective disciplinary mechanism for poorly performing boards and managers.
• 3 Compliance costs associated with SOX §404—Adopt a statutory amendment that makes it optional for a company to adopt the §404 procedures for a management assessment and auditor attestation of the effectiveness of its internal controls, with the requirement that if the company chooses not to comply it must explain why in its financial statements. Thus, in effect, the FER effectively recommends that the market be allowed to determine the value of §404 compliance. If a company chooses not to comply, the market will assess its explanation for non‐compliance and will value the company accordingly.
• 4 Maintaining open markets—Allow both foreign and U.S. firms to choose to report in conformity with either IFRS or U.S. GAAP. The FER recognizes both IFRS and U.S. GAAP as high‐quality accounting standards that provide reasonable foundations for financial reporting for investors. Allowing both foreign and U.S. firms to adopt whichever of these standards they believe to be the most cost‐effective provides an opportunity for the market and investors themselves to sort out which reporting standard best serves their interests.

     

Disclosure of GAAP line items in earnings announcements

We provide new evidence on the disclosure in earnings announcements of financial statement line items prepared under Generally Accepted Accounting Principles (GAAP). First, we investigate the circumstances that might provide disincentives generally for GAAP line item disclosures. We find that managers who regularly intervene in the earnings reporting process limit disclosures at the aggregate level and in each of the financial statements so as to more effectively guide investor attention to summary financial information. Specifically, this disclosure behavior obtains when managers habitually cater to market expectations, engage in income smoothing, or use discretionary accruals to improve earnings informativeness. Second, we predict and find that the specific GAAP line items that firms choose to disclose are determined by the differential informational demands of their economic environment, consistent with incentives to facilitate investor valuation. However, these valuation-related disclosure incentives are muted when managers habitually intervene in the earnings reporting process.     

Directors’ and Officers’ Liability Insurance and Aggressive Tax‐Reporting Activities: Evidence from Canada

This paper examines the relationship between directors’ and officers’ liability insurance (D&O insurance) and firms’ aggressive tax reporting. Using large Canadian public companies listed on the TSX300 and relying on several measures to capture aggressive tax‐reporting activities, including GAAP effective tax rates, cash effective tax rates, and the total and residual book‐tax differences, I find that D&O insurance exhibits a strong negative relationship with the GAAP effective tax rates and a strong positive relationship with both the total and residual book‐tax differences. However, there is generally no evidence showing that D&O insurance is associated with the cash effective tax rates. I interpret these results as indicating that D&O insurance reduces the tax expenses reported in the financial statements but not the actual tax paid. In other words, D&O insurance contributes to financial tax management but not to cash tax savings. Further tests in this study reveal that firms with fluctuating D&O coverage limits engage in more aggressive tax reporting than other firms, suggesting that managers may consider the level of D&O insurance that they purchase when they make aggressive tax‐reporting decisions.     

Assessing the Effect of the Transition to IFRS on Equity: The Case of the FTSE 100

The paper presents the results of an analysis of the reconciliations of equity presented as part of the transition from UK Generally Accepted Accounting Principles (UK GAAP) to International Financial Reporting Standards (IFRS) by the largest UK companies. While the overall effect on equity is not significant, the effect of the change in convention on individual line items could have important consequences for financial analysis and contractual obligations. The level of variability between companies means that this change will demand attention to detail by users of financial statements. The paper provides a benchmark for comparison with companies from other accounting traditions making the transition to IFRS.     

Bank debt covenants and firms’ responses to FAS 150 liability recognition: evidence from trust preferred stock

We examine the relation between accounting-based debt contracts and the economic response of firms with trust preferred stock (TPS) to mandated liability recognition under Financial Accounting Standard (FAS) 150. Our results show that firms’ financial covenants significantly affect their choice to redeem versus reclassify their outstanding TPS. Specifically, firms with bank debt covenants that would be adversely impacted by recognizing TPS as a debt liability are 26.88% more likely to redeem their TPS after FAS 150. We also find that firms are significantly more likely to redeem versus reclassify their TPS after FAS 150 if they used the original TPS proceeds to retire existing debt (id est, to enhance their balance sheets). Our findings suggest that when bank debt contracts use “floating” Generally Accepted Accounting Principles (GAAP) to construct financial covenant terms, changes in the underlying GAAP measure significantly influence firms’ economic behavior.     

IFRS in the United States – Developments and Current Status

International Financial Reporting Standards (IFRS) are now required or permitted for use by companies in more than 100 countries, including the majority of the G20 members. However, domestic public companies domiciled in the United States (US) continue to be required to file financial statements with the Securities and Exchange Commission (SEC) in accordance with US Generally Accepted Accounting Principles (US GAAP), and are prohibited from preparing them based on IFRS. This article describes the developments of IFRS‐related activities and initiatives in the US over the period 2007–2012, and provides an overview of the current status regarding potentially incorporating IFRS into the US financial reporting system based on recently issued reports by the SEC.     

A case against the consolidation of foreign subsidiaries’ and a United States parent’s financial statements

Generally accepted accounting principles in the United States usually require that companies which own more than 50% of the voting stock of foreign corporations prepare consolidated financial statements. The foreign financial statements must be recast into US GAAP and the foreign currency financial statements must be translated into US dollars. Alternative methods of translating foreign currency have major impacts on consolidated financial statements and on the behavior of management. Further, foreign subsidiary financial statements which are recast into US GAAP are less useful than the originals, and US users cannot analyze them without reference to the foreign environment. The interests of financial statement users are better served by alternative presentations of foreign currency denominated accounts rather than by consolidation.     

Executive Compensation and Financial Performance Measures: Evidence from Significant Financial Institutions

We survey the use of financial performance measures in determining executive pay among significant Australian financial institutions. We document evidence of the pervasiveness with which externally disclosed non‐GAAP (non‐Generally Accepted Accounting Principles) financial measures are also used internally to determine variable remuneration, with the apparent popularity of cash profit after tax in short‐term incentives plans. Our evidence also highlights the increasing use of peer group‐adjusted measures (e.g., relative cash earnings per share and return on equity ranking against a peer group) in determining longer‐run incentives, despite the fact that members of the peer group do not measure financial performance in a directly comparable manner. Detailed analysis of the four major trading banks (Australia and New Zealand Banking Group, Commonwealth Bank, National Australia Bank and Westpac) reveals differences in the way non‐GAAP earnings measures are calculated across the major banks, as well as some variation over time in the way individual banks measure performance. We also document evidence of non‐GAAP earnings restatements, with around 25% of non‐GAAP results subsequently being restated. These restatements are more likely to result in a downward revision of the initially reported non‐GAAP result than an upward revision. We therefore conclude that existing measures of financial performance used to determine senior executive compensation are not as ‘objective’, as might be assumed.     

MIND YOUR ACCRUALS: PERCEIVED USEFULNESS OF FINANCIAL INFORMATION IN THE AUSTRALIAN PUBLIC SECTOR UNDER DIFFERENT ACCOUNTING SYSTEMS

This study examines the usefulness of three accounting systems (cash, Generally Accepted Accounting Principles (GAAP) accrual, and Government Finance Statistics (GFS) accrual) for public sector decision‐making. From a survey of internal users, external users, and preparers in Australia, we find that GAAP accrual information is perceived to be relatively more useful and understandable than the other two systems for most decisions examined. The relatively higher ratings for GAAP accrual information differ from earlier studies and may reflect an experience or familiarity effect whereby perceptions of usefulness are enhanced because respondents have become more used to the system. This effect might also explain the lower ratings for GFS accrual.