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Meta-analysis of the Impact of Adoption of Ifrs on Financial Reporting Comparability, Market Liquidity and Cost of Capital

dc.contributor.authorOpare, Solomon
dc.contributor.authorHouqe, Noor
dc.contributor.authorVan Zijl, Tony
dc.date.accessioned2021-03-01T20:31:51Z
dc.date.accessioned2022-07-12T02:55:22Z
dc.date.available2021
dc.date.available2021-03-01T20:31:51Z
dc.date.available2022-07-12T02:55:22Z
dc.date.copyright2020
dc.date.issued2021
dc.description.abstractA large number of empirical studies have addressed the effects of adoption of IFRS, but the results have been mixed. We use a meta-analysis of 56 empirical studies with 1,265 effect sizes to determine the impact of adoption of IFRS on financial reporting comparability, market liquidity, cost of equity, and cost of debt. This approach provides an objective view of the empirical results, in contrast to narrative reviews which offer subjective conclusions. We find that IFRS adoption has increased financial reporting comparability, market liquidity, and reduced the cost of equity. For cost of debt, a decrease is observed only for voluntary adoption. Our meta-regression analysis explains the variation in the observed effect of adoption of IFRS across mandatory and voluntary adoption of IFRS, and choice of measures, control variables, estimation methods, and the strength of the empirical results. We emphasise the importance of these study characteristics and call for further studies focussing on the cost of debt and also studies using recent data to reflect the changes in IFRS. This study should be of interest to regulators and policymakers as they are expected to assess the impacts of adoption of IFRS.en_NZ
dc.formatpdfen_NZ
dc.identifier.urihttps://ir.wgtn.ac.nz/handle/123456789/21106
dc.language.isoen_NZ
dc.publisherTe Herenga Waka—Victoria University of Wellingtonen_NZ
dc.relation.ispartofseriesWorking Paperen_NZ
dc.relation.ispartofseriesNo. 120en_NZ
dc.subjectCost of equityen_NZ
dc.subjectCost of debten_NZ
dc.subjectFinancial reporting comparabilityen_NZ
dc.subjectIFRS adoptionen_NZ
dc.subjectMarket liquidityen_NZ
dc.subjectMeta-analysisen_NZ
dc.titleMeta-analysis of the Impact of Adoption of Ifrs on Financial Reporting Comparability, Market Liquidity and Cost of Capitalen_NZ
dc.typeTexten_NZ
vuwschema.contributor.unitCentre for Accounting, Governance and Taxation Researchen_NZ
vuwschema.contributor.unitSchool of Accounting and Commercial Lawen_NZ
vuwschema.subject.anzsrcfor150201 Financeen_NZ
vuwschema.subject.anzsrcforV2350199 Accounting, auditing and accountability not elsewhere classifieden_NZ
vuwschema.type.vuwWorking or Occasional Paperen_NZ

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