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The impact of IFRS 8 on financial analysts' earnings forecast errors: EU evidence

The impact of IFRS 8 on financial analysts' earnings forecast errors: EU evidence
The impact of IFRS 8 on financial analysts' earnings forecast errors: EU evidence
While the IASB has eliminated virtually all the differences between US GAAP and IFRS with respect to segment reporting, the quality of segment disclosure after IFRS 8 remains questionable, with the European Parliament only endorsing IFRS 8 after a great deal of scrutiny and much debate. We investigate the impact of segment information quality and quantity on analysts’ earnings forecasts after the adoption of IFRS 8.We further address how country-level enforcement influences this relationship using a sample from EU countries. The findings reveal that the quality and quantity of segment information are associated with more accurate earnings forecasts following IFRS 8. Furthermore, the results suggest that enforcement plays a pivotal role in shaping the impact of the principles-based IFRS 8. These findings contribute to the ongoing debate on the quality of segment information under the management approach and role of accounting regulation enforcement. They also provide early evidence on the usefulness of country-by-country reporting.
IFRS 8, Enforcement, EU , Analysts’ earnings forecasts
1061-9518
Aboud, Ahmed
18ecfd55-e808-435d-b78e-5d8a18457fd0
Roberts, Clare
b98a0b95-89b9-4b0d-8272-2ffc954c0190
Zalata, Alaa
0fc2c56d-97ad-44ce-ab31-63ca335dcef6
Aboud, Ahmed
18ecfd55-e808-435d-b78e-5d8a18457fd0
Roberts, Clare
b98a0b95-89b9-4b0d-8272-2ffc954c0190
Zalata, Alaa
0fc2c56d-97ad-44ce-ab31-63ca335dcef6

Aboud, Ahmed, Roberts, Clare and Zalata, Alaa (2018) The impact of IFRS 8 on financial analysts' earnings forecast errors: EU evidence. Journal of International Accounting, Auditing and Taxation. (doi:10.1016/j.intaccaudtax.2018.08.001).

Record type: Article

Abstract

While the IASB has eliminated virtually all the differences between US GAAP and IFRS with respect to segment reporting, the quality of segment disclosure after IFRS 8 remains questionable, with the European Parliament only endorsing IFRS 8 after a great deal of scrutiny and much debate. We investigate the impact of segment information quality and quantity on analysts’ earnings forecasts after the adoption of IFRS 8.We further address how country-level enforcement influences this relationship using a sample from EU countries. The findings reveal that the quality and quantity of segment information are associated with more accurate earnings forecasts following IFRS 8. Furthermore, the results suggest that enforcement plays a pivotal role in shaping the impact of the principles-based IFRS 8. These findings contribute to the ongoing debate on the quality of segment information under the management approach and role of accounting regulation enforcement. They also provide early evidence on the usefulness of country-by-country reporting.

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The Impact of IFRS 8 on Financial Analysts' Earnings Forecast Errors EU Evidence - Accepted Manuscript
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Accepted/In Press date: 3 May 2018
e-pub ahead of print date: 10 August 2018
Keywords: IFRS 8, Enforcement, EU , Analysts’ earnings forecasts

Identifiers

Local EPrints ID: 422057
URI: http://eprints.soton.ac.uk/id/eprint/422057
ISSN: 1061-9518
PURE UUID: 53d1eece-bfa9-457c-81dc-be12cbcc0630
ORCID for Alaa Zalata: ORCID iD orcid.org/0000-0003-2018-4313

Catalogue record

Date deposited: 13 Jul 2018 16:30
Last modified: 08 Aug 2020 04:01

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