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IFRS and the value relevance of earnings: evidence from the emerging market of Romania

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  • Andrei Filip

Abstract

This paper investigates the impact of the mandatory IFRS adoption on the value relevance of earnings on the Bucharest Stock Exchange, at a time when the EU did not have an official position regarding IFRS. Findings suggest that the implementation of IFRS has increased the contemporaneous association between market returns and earnings. Additional analyses reveal that this result is mainly driven by small firms and that the accounting reforms have increased the timeliness of earnings. In the light of the expansion of IFRS worldwide, this paper examines the mandatory IFRS adoption in an institutional setting where accounting reforms were accompanied by economic reforms in preparation for Romania's accession to the EU. Such a single-country case study may help researchers better understand the impact of accounting regulations and institutional factors on the properties of accounting earnings.

Suggested Citation

  • Andrei Filip, 2010. "IFRS and the value relevance of earnings: evidence from the emerging market of Romania," International Journal of Accounting, Auditing and Performance Evaluation, Inderscience Enterprises Ltd, vol. 6(2/3), pages 191-223.
    • Handle: RePEc:ids:ijaape:v:6:y:2010:i:2/3:p:191-223
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    Citations

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    Cited by:

    1. Dhiaa Shamki, 2012. "Impact of Non Accounting Information on The Value Relevance of Accounting Information: The Case of Jordan," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 2(1), pages 9-24, February.
    2. Raluca Valeria RATIU, 2012. "Accounting Regulations for Goodwill at a National, European and International Level," Romanian Statistical Review Supplement, Romanian Statistical Review, vol. 60(4), pages 249-258, November.
    3. André, Paul & Filip, Andrei & Paugam, Luc, 2013. "Impact of Mandatory IFRS Adoption on Conditional Conservatism in Europe," ESSEC Working Papers WP1311, ESSEC Research Center, ESSEC Business School.
    4. Dhiaa Shamki, 2012. "Impact of Non Accounting Information on The Value Relevance of Accounting Information: The Case of Jordan," International Journal of Business and Social Research, LAR Center Press, vol. 2(1), pages 9-24, February.
    5. Fahim Javed & Nargis Akhtar & Muhammad Fayyaz Sheikh & Muhammad Shahid Rasheed, 2023. "Social Anxiety, Self-efficacy and Academic Achievement in Matric Students of Lahore Pakistan," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 9(1), pages 28-37, March.
    6. repec:hal:journl:hal-00862683 is not listed on IDEAS
    7. Matthew Wegener & Réal Labelle, 2017. "Value Relevance of Environmental Provisions Pre‐ and Post‐IFRS," Accounting Perspectives, John Wiley & Sons, vol. 16(3), pages 139-168, September.
    8. Wensheng Kang, 2013. "The impact of mandatory IFRS adoption on the earnings--returns relation," Applied Financial Economics, Taylor & Francis Journals, vol. 23(13), pages 1137-1143, July.
    9. Abdulrahman Alomair & Alan Farley & Helen Hong Yang, 2022. "The impact of IFRS adoption on the value relevance of accounting information in Saudi Arabia," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(2), pages 2839-2878, June.
    10. Paul André & Andrei Filip & Luc Paugam, 2015. "The Effect of Mandatory IFRS Adoption on Conditional Conservatism in Europe," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 42(3-4), pages 482-514, April.
    11. Diana-Andreea, TRAISTARU, 2014. "The Application Of International Financial Reporting Standards In Romania: Advantages And Main Problems," Management Strategies Journal, Constantin Brancoveanu University, vol. 26(4), pages 271-277.
    12. Raluca Valeria RATIU, 2014. "Accounting Regulations For Goodwill In An Emerging Country- The Case Of Romania," SEA - Practical Application of Science, Romanian Foundation for Business Intelligence, Editorial Department, issue 5, pages 549-554, November.
    13. Jamal Barzegari Khanagha, 2011. "Value Relevance of Accounting Information in the United Arab Emirates," International Journal of Economics and Financial Issues, Econjournals, vol. 1(2), pages 33-45, June.

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