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Working Papers, Institut für Empirische Wirtschaftsforschung, Universität Osnabrück >
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http://hdl.handle.net/10419/66501
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| Title: | | Does the introduction of IFRS change the timeless of loss recognition? Evidence from German firms  |
| Authors: | | Brauer, Sebastian Leuschner, Carl-Friedrich Westermann, Frank |
| Issue Date: | | 2011 |
| Series/Report no.: | | Working Paper, Institute of Empirical Economic Research, University of Osnabrück 87 |
| Abstract: | | In this paper, we re-evaluate the hypothesis that the introduction of the IFRS has an impact on the timeliness of loss recognition. We test this hypothesis in a data set of public German firms that report according to German-GAAP and IFRS, respectively. The parallel use of the two accounting standards in Germany provides a unique opportunity to contribute to the academic discussion, as well as to the current policy debate on regulatory reform in Germany. Starting from the standard time series concept of conditional conservatism that was initially proposed by Basu (1997), we implement a wide range of test specifications, including (i) a threshold unitroot test specification; (ii) a multivariate approach to outlier detection and (iii) various forms of controlling for fixed effects. We do not find evidence that IFRS and German-GAAP firms differ with respect to their timeliness of loss recognition in any of these specifications - a result that appears surprising in light of the more prudent regulation in the German-GAAP, but is consistent with some earlier findings in the literature. |
| Subjects: | | IFRS, German-GAAP Timely loss recognition Conservatism |
| JEL: | | M41 M48 C22 K22 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Working Papers, Institut für Empirische Wirtschaftsforschung, Universität Osnabrück
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