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Type: Journal article
Title: The impact of IFRS on financial analysts' forecast accuracy in the Asia-Pacific region: The case of Australia, Hong Kong and New Zealand
Author: Cheong, C.
Kim, S.
Zurbrugg, R.
Citation: Pacific Accounting Review, 2010; 22(2):124-146
Publisher: Emerald Publishing Group Ltd
Issue Date: 2010
ISSN: 0114-0582
Statement of
Chee Seng Cheong, Sujin Kim and Ralf Zurbruegg
Abstract: Purpose – This paper aims to provide an investigation into whether financial analysts' forecast accuracy differs between the pre- and post-adoption of the international financial reporting standards (IFRS) in the Asia-Pacific region, namely, for the countries of Australia, Hong Kong and New Zealand. In particular, this study seeks to examine whether the treatment of intangibles capitalized in the post-IFRS period have positively aided analysts in forecasting future earnings of a firm. Design/methodology/approach – Panel data analysis is applied over a period from 2001 to 2008. Findings – Evidence is found to show intangibles capitalized under the new recognition and measurement rules of IFRS are negatively associated with analysts' earnings forecast errors. The results are robust to several model specifications across each of the countries, suggesting that the adoption of IFRS may indeed provide more value-relevant information in financial statements for the users of financial reports. Originality/value – This paper analyzed whether the adoption of IFRS has led to any changes in the accuracy of earnings forecasts. The results will be of help to analysts' earnings forecast activity and those with interest in the subject.
Keywords: Financial analysis; Financial forecasting; International standards; Pacific region
Rights: © Emerald Group Publishing Limited.
RMID: 0020102103
DOI: 10.1108/01140581011074511
Appears in Collections:Business School publications

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