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Non-IFRS Earnings Measures in Annual Reports of European Companies

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  • Tomáš Zahradníček

Abstract

The article examines disclosure of non-IFRS earnings measures (also called alternative performance measures). The data sample consists of 600 companies that constitute index EUROSTOXX 600 for the years 2021 and 2022. We prove that non-IFRS earnings measures hold a very prominent role in financial reporting. We provide evidence that the reporting of solely IFRS earnings measures in annual reporting is very rare, with only 3% of companies use only IFRS measures. On the contrary, a substantial number of companies (74%) include adjusted non-IFRS measures into unaudited parts of annual reports. Moreover, 25% of companies put adjusted non-IFRS measures into their audited income statements. Our findings enlighten how widespread non-IFRS measures are among European companies and how the European institutions approach this practice of financial reporting.

Suggested Citation

  • Tomáš Zahradníček, 2024. "Non-IFRS Earnings Measures in Annual Reports of European Companies," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2024(2), pages 21-43.
    • Handle: RePEc:prg:jnlefa:v:2024:y:2024:i:2:id:287:p:21-43
    DOI: 10.18267/j.efaj.287
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    More about this item

    Keywords

    Alternative Performance Measures; IFRS Regulation; Non-IFRS Earnings; Voluntary Disclosure;
    All these keywords.

    JEL classification:

    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

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