ICARE 2018

Permanent URI for this collectionhttp://repository.kln.ac.lk/handle/123456789/19607

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Subject: search.filters.subject.Manufacturing companies

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    The Impact of IFRS Adoption on Financial Statements and Value Relevance: Evidence from Sri Lanka
    (4th International Conference for Accounting Researchers and Educators, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2018) Dissanayaka, H.M.K.G.L.B.; Karunathna, W.V.A.D.
    The aim of this study is to explore the effect of International Financial Reporting Standards (IFRS) adoption on commonly employed financial ratios and investigate the value relevance of IFRS adoption by comparing the association between accounting measures and market values under GAAP and under IFRS of listed manufacturing companies in Colombo Stock Exchange. This study employs 20 listed manufacturing companies with both pre-IFRS (2009- 2011) and post-IFRS (2013-2015) information. Data were analyzed by using panel data regression model and correlation analysis. And also T test and Wilcoxon signed rank test are used to explore the effect of IFRS adoption on financial ratios. Results of the study showed that IFRS adoption does not significantly change the central values that depict the financial position and performance of Sri Lankan companies in financial statements. Therefore value relevance of accounting information has not significantly improved in the post-IFRS period than the pre-IFRS period. However several financial statement measures and ratio are affected significantly in transition to IFRS. Further studies are encouraged to conduct on investigating the impact of IFRS adoption on financial statement and value relevance by expanding the sample size with incorporating more accounting quality measurement indicators, measurement and ratios
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    The Impact of International Financial Reporting Standards Adoption on the Value Relevance of Accounting Information: Evidence from the Public Listed Manufacturing Companies in the Colombo Stock Exchange in Sri Lanka
    (4th International Conference for Accounting Researchers and Educators, Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2018) Athukorala, A.S.P.; Karunarathna, W.V.A.D.
    The purpose of this study is to investigate the impact of International Financial Reporting Standard (IFRS) adoption on the value relevance of accounting information in Sri Lanka and also the study has made a comparison between the value relevance of accounting information in pre- and post- adoption periods of IFRS. Sri Lanka has adopted Sri Lanka Financial Reporting Standards (SLFRS) which is almost aligned with the IFRS with effect from 1st January 2012 onwards. This study employs Ohlson (1995) price regression model to explain value relevance of accounting information. It explains market value per share (MPS) using earning per share (EPS) and book value of equity per share (BVEPS). The pre-IFRS period consist of 5 years from 2007 to 2011, and the post-IFRS period is 5years from 2012 to 2016. The sample comprises 28 firms and 280 firm-year observations. There are many studies available on IFRS adoption internationally. However, there is no clear evidence that IFRS adoption enhances the quality of accounting information pertaining to Sri Lankan context. Mainly the data were analyzed by using multiple regression model and correlation analysis. Results of the study showed that value relevance of accounting information has not significantly improved in the post- IFRS period than the pre-IFRS period. Further studies are encouraged to conduct by expanding the sample size and incorporating more accounting quality measurement indicators.