An International Exploration of Financial Reporting Practices in the Real Estate Industry
AbstractThe adoption of the new International Financial Reporting Standards (IFRS), by allowing the option of fair value accounting for real estate investment properties, has dramatically altered the landscape of financial reporting for real estate firms worldwide. In this exploratory study, by examining the financial statements and disclosures of 45 international real estate firms, we demonstrate that the implementation of IFRS has affected financial reporting practices in the real estate industry. We find that under the IFRS, companies place emphasis on market asset valuations, vis-a-vis alternative metrics for current performance. We also find that most real estate firms in our sample choose to report fair values for investment properties in their financial statements rather than the notes to the financial statements. Finally, there is a wide variation in firm disclosures with regards to the determinants of fair market values.
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Bibliographic InfoArticle provided by Asian Real Estate Society in its journal International Real Estate Review.
Volume (Year): 15 (2012)
Issue (Month): 3 ()
Contact details of provider:
Postal: Asia Real Estate Society, 51 Monroe Street, Plaza E-6, Rockville, MD 20850, USA
Web page: http://www.asres.org/
Postal: Asian Real Estate Society, 51 Monroe Street, Plaza E-6, Rockville, MD 20850, USA
Find related papers by JEL classification:
- L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services
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- Danny Ben-Shahar & Eyal Sulganik & Desmond Tsang, 2011. "Funds from Operations Versus Net Income: Examining the Dividend-Relevance of REIT Performance Measures," Journal of Real Estate Research, American Real Estate Society, vol. 33(3), pages 415-442.
- Danny Ben-Shahar & Yoram Margalioth & Eyal Sulganik, 2009. "The Straight-Line Depreciation is Wanted, Dead or Alive," Journal of Real Estate Research, American Real Estate Society, vol. 31(3), pages 351-370.
- Aboody, David & Barth, Mary E. & Kasznik, Ron, 1999. "Revaluations of fixed assets and future firm performance: Evidence from the UK1," Journal of Accounting and Economics, Elsevier, vol. 26(1-3), pages 149-178, January.
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