of applicable standards on the part of preparers, and lack of understanding and
resources on the part of auditors, as examples.
Equally, the policy implications of systematic (but not fraudulently or
opportunistically motivated) deviations from the precepts of mandatory reporting
frameworks differ materially from those raised in cases of fraud or by dint of excessive
manoeuvre space within the boundaries (or at the intersection of the boundaries) of
reporting standards.
Yet, as argued above, the compliance degree question has thus far been largely
overlooked in the context of research on impairment testing, even though the impairment
testing procedures mandated under IFRS are highly complex and represent a substantial
compliance challenge. The few examples of published papers devoted to the subject of
financial statement standards compliance have reinforced the gravity of this issue and
its need for further attention. For example, Hodgdon et al. (2008) demonstrated the
existence of material non-compliance with aspects of the IAS framework by European
reporting entities and showed the negative effect of this on the capacity of analysts to
generate accurate forecasts. In a later related study, the same authors demonstrated a
basis for considerable concern in relation to the capacity of the audit mechanism to
adequately control the compliance dimension of reporting (Hodgdon et al., 2009).
Consequently, it is the subject of compliance which constitutes the principal focus of the
research reported in this paper. Section 3 sets out details of the methodology employed
and data drawn upon for the purposes of investigating this question.
3. Data and methodology
A-IFRS came into effect in Australia for firms with reporting periods on or after
1 January 2005. Consequently, a subset of listed Australian companies reported
pursuant to IFRS in that year. However, since the only organisations to do so were
those with a balance date of 31 December, and since this group represents a relatively
small subset of the Australian listed firm population, it was necessary to construct our
data sample based on 2006 data, being the first year in which IFRS was the default
reporting regime for essentially all Australian listed entities.
In light of this, the research reported in this paper focuses on data drawn from a
sample of 200 large Australian listed corporations which reported goodwill as one
element of their asset base in their 2006 consolidated financial statements.
Each of the 200 firms which comprised our final research sample was a constituent
firm within the All Ordinaries Index as at December 2006. The All Ordinaries index was
created, with a base date of 31December 1979, replacing the regional indices, which were
independently run out of the Sydney and Melbourne stock exchanges. Administered
since 2000 by Standard&Poor’s, in partnership with the Australian Stock Exchange, the
All Ordinaries Index is the most extensive index covering the Australian stock market,
comprising a maximum of 500 of the largest companies listed on the Australian Stock
Exchange.While the AllOrdinaries Index is no longer an institutional benchmark index,
having been superseded by a more concentrated series of benchmark indices
(Standard&Poor’s, 2007)[12], the index has the largest coverage of all Australian equities
indices and typically represents more than 95 per cent of the market capitalisation for
Australia (Standard&Poor’s, 2004)[13].
The month end market capitalisation of the Australian stock market at December 2006
was approximately $1.390 trillion[14]. Itwas comprised of 1,908 listed companies and list
of applicable standards on the part of preparers, and lack of understanding and
resources on the part of auditors, as examples.
Equally, the policy implications of systematic (but not fraudulently or
opportunistically motivated) deviations from the precepts of mandatory reporting
frameworks differ materially from those raised in cases of fraud or by dint of excessive
manoeuvre space within the boundaries (or at the intersection of the boundaries) of
reporting standards.
Yet, as argued above, the compliance degree question has thus far been largely
overlooked in the context of research on impairment testing, even though the impairment
testing procedures mandated under IFRS are highly complex and represent a substantial
compliance challenge. The few examples of published papers devoted to the subject of
financial statement standards compliance have reinforced the gravity of this issue and
its need for further attention. For example, Hodgdon et al. (2008) demonstrated the
existence of material non-compliance with aspects of the IAS framework by European
reporting entities and showed the negative effect of this on the capacity of analysts to
generate accurate forecasts. In a later related study, the same authors demonstrated a
basis for considerable concern in relation to the capacity of the audit mechanism to
adequately control the compliance dimension of reporting (Hodgdon et al., 2009).
Consequently, it is the subject of compliance which constitutes the principal focus of the
research reported in this paper. Section 3 sets out details of the methodology employed
and data drawn upon for the purposes of investigating this question.
3. Data and methodology
A-IFRS came into effect in Australia for firms with reporting periods on or after
1 January 2005. Consequently, a subset of listed Australian companies reported
pursuant to IFRS in that year. However, since the only organisations to do so were
those with a balance date of 31 December, and since this group represents a relatively
small subset of the Australian listed firm population, it was necessary to construct our
data sample based on 2006 data, being the first year in which IFRS was the default
reporting regime for essentially all Australian listed entities.
In light of this, the research reported in this paper focuses on data drawn from a
sample of 200 large Australian listed corporations which reported goodwill as one
element of their asset base in their 2006 consolidated financial statements.
Each of the 200 firms which comprised our final research sample was a constituent
firm within the All Ordinaries Index as at December 2006. The All Ordinaries index was
created, with a base date of 31December 1979, replacing the regional indices, which were
independently run out of the Sydney and Melbourne stock exchanges. Administered
since 2000 by Standard&Poor’s, in partnership with the Australian Stock Exchange, the
All Ordinaries Index is the most extensive index covering the Australian stock market,
comprising a maximum of 500 of the largest companies listed on the Australian Stock
Exchange.While the AllOrdinaries Index is no longer an institutional benchmark index,
having been superseded by a more concentrated series of benchmark indices
(Standard&Poor’s, 2007)[12], the index has the largest coverage of all Australian equities
indices and typically represents more than 95 per cent of the market capitalisation for
Australia (Standard&Poor’s, 2004)[13].
The month end market capitalisation of the Australian stock market at December 2006
was approximately $1.390 trillion[14]. Itwas comprised of 1,908 listed companies and list
การแปล กรุณารอสักครู่..