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IFRS Adoption and Financial Reporting Quality: Taiwan Experience

Author

Listed:
  • Ching-Chieh Lin

    (I-Shou University)

  • Chi-Yun Hua

    (Fu Jen Catholic University)

  • Wen-Hsiang Lin

    (I-Shou University)

  • Wen-Chih Lee

    (National Kaohsiung University of Applied Sciences Kaohsiung)

Abstract

Taiwan’s financial accounting regulatory amendment directions shift the framework from the U.S. GAAP-based to International Financial Reporting Standards (IFRS)-based to accelerate the pace of progress towards convergence with IFRS. In the amendment process, the converge outcomes of earnings quality become an important and urgent issue. The purpose of this study is to investigate the converge impacts on reporting quality over 1999 to 2009, which divided into three timeframes: the U.S. GAAP-based era ranging from 1999-2005, the IFRS convergence era ranging from 2006-2007, and the preparation period of IFRS adoption ranging from 2008-2009. Two criteria of reporting quality is included: value relevance and the magnitude of earnings management. The empirical results show that the financial reporting quality got improvement under the amendment towards IFRS adoption.

Suggested Citation

  • Ching-Chieh Lin & Chi-Yun Hua & Wen-Hsiang Lin & Wen-Chih Lee, 2012. "IFRS Adoption and Financial Reporting Quality: Taiwan Experience," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 2(4), pages 283-292, October.
    • Handle: RePEc:hur:ijaraf:v:2:y:2012:i:4:p:283-292
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    References listed on IDEAS

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    3. Ball, Ray & Robin, Ashok & Wu, Joanna Shuang, 2003. "Incentives versus standards: properties of accounting income in four East Asian countries," Journal of Accounting and Economics, Elsevier, vol. 36(1-3), pages 235-270, December.
    4. Brenda van Tendeloo & Ann Vanstraelen, 2005. "Earnings management under German GAAP versus IFRS," European Accounting Review, Taylor & Francis Journals, vol. 14(1), pages 155-180.
    5. Street, Donna L. & Gray, Sidney J. & Bryant, Stephanie M., 1999. "Acceptance and Observance of International Accounting Standards: An Empirical Study of Companies Claiming to Comply with IASs," The International Journal of Accounting, Elsevier, vol. 34(1), pages 11-48.
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    Cited by:

    1. Ikechukwu Okoye & Nwoye John Ugochukwu & Abiahu Mary-Fidelis Chidoziem, 2018. "Forestalling Ingenious Approach to Financial Reporting in Post IFRS Regime in Dangote Cement Company Nigeria PLC," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 8(2), pages 259-271, April.

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    More about this item

    Keywords

    International Financial Reporting Standards; IFRS adoption; financial reporting quality; accounting standards; value relevance;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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