Consolidated financial reporting and the effect of mandatory IFRS adoption on the information content of earnings announcements: evidence from Korea

Joonhyun Kim, Sukyoon Jung, Mihye Ha

Research output: Contribution to journalArticlepeer-review

Abstract

We examine the effect of mandatory IFRS adoption on the information content of earnings announcement in Korea, and its main driving factors. We find an increase in earnings information content with IFRS adoption; however, this increase is only weakly associated with the IFRS reconciliation adjustment, as a proxy for accounting rule differences. In contrast, we observe a strong association between the availability of consolidated financial statements and the increase in information content. Collectively, our analysis contributes to understanding the source of the IFRS effect, by providing new evidence of the crucial role of disclosure policy changes in consolidated reporting. Abbreviation: International Financial Accounting Standards (IFRS).

Original languageEnglish
Pages (from-to)674-695
Number of pages22
JournalAsia-Pacific Journal of Accounting and Economics
Volume28
Issue number6
DOIs
StatePublished - 2021

Keywords

  • IFRS adoption
  • IFRS reconciliation
  • consolidated reporting
  • earnings announcement
  • information content

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