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Transition to IFRS and value relevance in a small but developed market: A look at Greek evidence

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Author Info

  • Ioannis Tsalavoutas

    (Department of Accounting and Finance - University of Stirling)

  • Paul André

    (Accounting / Management Control Department - ESSEC Business School)

  • Lisa Evans

    (Department of Accounting and Finance - University of Stirling)

Abstract

We examine the value relevance of accounting fundamentals after the mandatory transition to IFRS in Greece. We find no significant change in the value relevance of book value of equity and earnings between the 2004 pre IFRS and 2005 post IFRS periods and conclude that the accounting framework is not in itself sufficient for changing market participants' perception about value relevance of accounting information. However, market participants viewed the extra information provided by reconciliations between Greek GAAP and IFRS for 2004 figures as incrementally value relevant. Specifically, this applied to adjustments resulting from standards curtailing previous creative accounting practices and was mainly driven by firms with lower reporting quality (smaller firms and firms with non-‘Big 4' auditors).

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Bibliographic Info

Paper provided by HAL in its series Post-Print with number halshs-00460532.

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Date of creation: 2009
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Publication status: Published - Presented, La place de la dimension européenne dans la Comptabilité Contrôle Audit, 2009, Strasbourg, France
Handle: RePEc:hal:journl:halshs-00460532

Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00460532/en/
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Related research

Keywords: Value relevance; IFRS implementation; Greece; creative accounting; firm size; audit quality.;

References

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Cited by:
  1. Karampinis, Nikolaos I. & Hevas, Dimosthenis L., 2011. "Mandating IFRS in an Unfavorable Environment: The Greek Experience," The International Journal of Accounting, Elsevier, vol. 46(3), pages 304-332, September.

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