Accounting profession has, in recent times, been regulated mainly by the private accounting standard setters mainly the International Accounting Standards Board （IASB）, which has taken a center stage and redefined t...Accounting profession has, in recent times, been regulated mainly by the private accounting standard setters mainly the International Accounting Standards Board （IASB）, which has taken a center stage and redefined the accounting information systems beyond the knowledge discernment of the average users and stakeholders. Public accounting profession＇s overreliance on the ever-changing IASB conceptual frameworks and their subsequent publications International Financial Reporting Standards （IFRS） standards has strongly compromised the ethics and objectivity of the profession, especially the accounting fundamental qualitative characteristics of the fair representation. Public accountants are, by ethics, required to issue an accurate, independent, and objective opinion of the financial state of the reporting entity. A review of various literatures from the IASB and the related bodies including independent auditors was employed during the evaluation process so as to minimize bias and evaluate objectively. The results revealed that currently, the IASB conceptual frameworks and IFRS contain inconsistent and opposing objectives including an inconclusive definition of elements and measurement basis mainly of profit and loss transactions and other comprehensive income, and hence the public accounting profession has been ethically challenged and compromised. Financial reporting is now premised on estimates, judgments, and models as opposed to a definitive measurement in accounting. A recommendation of further study on the IASB fundamental qualitative characteristics of decision usefulness should be pursued objectively.展开更多
The Management Discussion and Analysis （MD＆A） is a mandatory document under the European Union＇s （EU） law. In 2003, the EU issued Directive 2003/51/EC, which broadened the information that firms have to provide ...The Management Discussion and Analysis （MD＆A） is a mandatory document under the European Union＇s （EU） law. In 2003, the EU issued Directive 2003/51/EC, which broadened the information that firms have to provide in their MD＆A, and in 2010 the International Accounting Standards Board （IASB） issued the International Financial Reporting Standards （IFRS） Practice Statement ＂Management Commentary＂, a non-binding guidance for the presentation of this document. The aim of this paper is to examine the relationship between MD＆A disclosure quality and properties of analysts＇ forecasts. In fact, although most studies found that financial analysts mainly refer to financial statement data in forecasting earnings, there are few researches highlighting the importance of MD＆A disclosures for financial analysts. On this basis, Ramnath, Rock, and Shane （2008） called for researches in order to better understand the relationship between the information really used by analysts and their forecasts. To assess the quality of MD＆A disclosures, we developed a multidimensional measure on the basis of the EU requirements and the IFRS Practice Statement, and then we regressed this variable on both forecast accuracy and dispersion. The findings show that our measure of MD＆A disclosure quality is significantly and positively related to forecast accuracy. We conducted other analyses in order to better understand the previous relationship and we found that, if we analyze the different information contained in the MD＆A statement, financial analysts consider useful accounting and financial data in forecasting earnings. These results enhance our understanding of the role of MD＆A disclosures in the wide set of information that firms provide to financial statement users.展开更多
文摘Accounting profession has, in recent times, been regulated mainly by the private accounting standard setters mainly the International Accounting Standards Board （IASB）, which has taken a center stage and redefined the accounting information systems beyond the knowledge discernment of the average users and stakeholders. Public accounting profession＇s overreliance on the ever-changing IASB conceptual frameworks and their subsequent publications International Financial Reporting Standards （IFRS） standards has strongly compromised the ethics and objectivity of the profession, especially the accounting fundamental qualitative characteristics of the fair representation. Public accountants are, by ethics, required to issue an accurate, independent, and objective opinion of the financial state of the reporting entity. A review of various literatures from the IASB and the related bodies including independent auditors was employed during the evaluation process so as to minimize bias and evaluate objectively. The results revealed that currently, the IASB conceptual frameworks and IFRS contain inconsistent and opposing objectives including an inconclusive definition of elements and measurement basis mainly of profit and loss transactions and other comprehensive income, and hence the public accounting profession has been ethically challenged and compromised. Financial reporting is now premised on estimates, judgments, and models as opposed to a definitive measurement in accounting. A recommendation of further study on the IASB fundamental qualitative characteristics of decision usefulness should be pursued objectively.
文摘The Management Discussion and Analysis （MD＆A） is a mandatory document under the European Union＇s （EU） law. In 2003, the EU issued Directive 2003/51/EC, which broadened the information that firms have to provide in their MD＆A, and in 2010 the International Accounting Standards Board （IASB） issued the International Financial Reporting Standards （IFRS） Practice Statement ＂Management Commentary＂, a non-binding guidance for the presentation of this document. The aim of this paper is to examine the relationship between MD＆A disclosure quality and properties of analysts＇ forecasts. In fact, although most studies found that financial analysts mainly refer to financial statement data in forecasting earnings, there are few researches highlighting the importance of MD＆A disclosures for financial analysts. On this basis, Ramnath, Rock, and Shane （2008） called for researches in order to better understand the relationship between the information really used by analysts and their forecasts. To assess the quality of MD＆A disclosures, we developed a multidimensional measure on the basis of the EU requirements and the IFRS Practice Statement, and then we regressed this variable on both forecast accuracy and dispersion. The findings show that our measure of MD＆A disclosure quality is significantly and positively related to forecast accuracy. We conducted other analyses in order to better understand the previous relationship and we found that, if we analyze the different information contained in the MD＆A statement, financial analysts consider useful accounting and financial data in forecasting earnings. These results enhance our understanding of the role of MD＆A disclosures in the wide set of information that firms provide to financial statement users.
