• Journal of Intelligence and Information Systems
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• v.20 no.4
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• pp.141-154
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• 2014

The adoption of International Financial Reporting Standards (IFRS) is the one of important issues in the recent accounting research because the change from local GAAP (Generally Accepted Accounting Principles) to IFRS has a substantial effect on accounting information. Over 100 countries including Australia, China, Canada and the European Union member countries adopt IFRS (International Financial Reporting Standards) for financial reporting purposes, and several more including the United States and Japan are considering the adoption of IFRS (International Financial Reporting Standards). In Korea, 61 firms voluntarily adopted Korean International Financial Reporting Standard (K-IFRS) in 2009 and 2010 and all listed firms mandatorily adopted K-IFRS (Korea-International Financial Reporting Standards) in 2011. The adoption of IFRS is expected to increase financial statement comparability, improve corporate transparency, increase the quality of financial reporting, and hence, provide benefits to investors This study investigates whether recognized accounts receivable discounting (AR discounting) under Korean International Financial Reporting Standard (K-IFRS) is more value relevant than disclosed AR discounting under Korean Generally Accepted Accounting Principles (K-GAAP). Because more rigorous standards are applied to the derecognition of AR discounting under K-IFRS(Korea-International Financial Reporting Standards), most AR discounting is recognized as a short term debt instead of being disclosed as a contingent liability unless all risks and rewards are transferred. In this research, I try to figure out industrial responses to the changes in accounting rules for the treatment of accounts receivable toward more strict standards in the recognition of sales which occurs with the adoption of Korea International Financial Reporting Standard. This study examines whether accounting information is more value-relevant, especially information on accounts receivable discounting (hereinafter, AR discounting) is value-relevant under K-IFRS (Korea-International Financial Reporting Standards). First, note that AR discounting involves the transfer of financial assets. Under Korean Generally Accepted Accounting Principles (K-GAAP), when firms discount AR to banks before the AR maturity, firms conventionally remove AR from the balance-sheet and report losses from AR discounting and disclose and explain the transactions in the footnotes. Under K-IFRS (Korea-International Financial Reporting Standards), however, most firms keep AR and add a short-term debt as same as discounted AR. This process increases the firms' leverage ratio and raises the concern to the firms about investors' reactions to worsening capital structures. Investors may experience the change in perceived risk of the firm. In the study sample, the average of AR discounting is 75.3 billion won (maximum 3.6 trillion won and minimum 18 million won), which is, on average 7.0% of assets (maximum 38.6% and minimum 0.002%), 26.2% of firms' accounts receivable (maximum 92.5% and minimum 0.003%) and 13.5% of total liabilities (maximum 69.5% and minimum 0.004%). After the adoption of K-IFRS (Korea-International Financial Reporting Standards), total liabilities increase by 13%p on average (maximum 103%p and minimum 0.004%p) attributable to AR discounting. The leverage ratio (total liabilities/total assets) increases by an average 2.4%p (maximum 16%p and minimum 0.001%p) and debt-to-equity ratio increases by average 14.6%p (maximum 134%p and minimum 0.006%) attributable to the recognition of AR discounting as a short-term debt. The structure of debts and equities of the companies engaging in factoring transactions are likely to be affected in the changes of accounting rule. I suggest that the changes in accounting provisions subsequent to Korea International Financial Reporting Standard adoption caused significant influence on the structure of firm's asset and liabilities. Due to this changes, the treatment of account receivable discounting have become critical. This paper proposes an intelligent diagnostic system for estimating negative impact on stock value with self-organizing maps and case based reasoning. To validate the usefulness of this proposed model, real data was analyzed. In order to get the significance of this proposed model, several models were compared to the research model. I found out that this proposed model provides satisfactory results with compared models.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.12
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• pp.233-243
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• 2020

This study aims to assess the impacts of COVID-19 on International Financial Reporting Standards (IFRS), because of the problems associated with changing and amending the financial reports according to the policies established based on the circumstances of the epidemic. The study sample targeted several international financial reports that were amended based on epidemic conditions. The revised financial reporting period provides standardized reporting procedures for financial transactions worldwide despite the pandemic. Therefore, IFRS has been used to reduce challenges in financial reporting by monitoring the duration of social distancing while reporting matters to eliminate confirmed uncertainty and judgment. After analyzing the data obtained through global search engines, the results conducted provided evidence that COVID-19 affects financial reporting in companies around the world. Therefore, companies face difficulty reporting finances based on the challenging environment that the pandemic represents. Besides, IFRS fair value measurements consider the prices that were predicted according to current market values. The contexts of the changing the standards by IFRS to curb the effects of the COVID19 financial reporting was attained through evaluation of the online files that were randomly selected and filtered to obtain valid data.

• Asian Journal of Business Environment
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• v.5 no.3
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• pp.17-21
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• 2015

Purpose - This paper compares current requirements for depreciation accounting from the Financial Accounting Standards Board in America for equity securities and all debt securities with determinable fair value, and disclosure requirements related to the fair value of securities below registered cost with the requirements of the international Financial Reporting Standards Board and accounting standards committee. Research design, data, and methodology - Mini-review statements are examined relating to depreciation of investments in America and the Financial Accounting Standards depreciation of investments in Iran that meet the requirements of international reporting standards and the Iranian Accounting Standards Committee. Results - Accounting rules for depreciation of investments in securities requires a good deal of judgment. In particular, devaluation decisions during the recession and market crisis were controversial, although even with no clear guidelines on devaluation, sometimes such decisions were simple. Conclusions -Companies can choose from formal policies applied uniformly and documentations of interest to provide a summary of the principles and conclusions obtained through disclosure, enabling market participants to assess the entity's conclusions reasonably, thereby easing investor and market worries.

• Korean small business review
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• v.42 no.2
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• pp.1-22
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• 2020

This paper examines the effect of the adoption of international financial reporting standards(IFRS) on the financial reporting of SMEs. As IFRS is principle-based, management's discretion is needed to reflect the economic substance of transactions, and a sound internal accounting infrastructure is needed to support the judgment process. In the case of SMEs, the internal accounting infrastructure is not well established, which makes it difficult to apply principle-based accounting. The survey analysis of 132 small and medium-sized business accounting managers listed in the domestic stock market showed that the reliability of financial statements has increased due to the introduction of IFRS. In particular, SMEs perceived their financial statements as being more reliable after the adoption of IFRS than midsize companies. However, it was found that the costs and risks from the preparation of financial statements have increased significantly, and conflicts between auditors and supervisory authorities related to the application of the principles have increased. In particular, midsize companies felt the increase in conflict with auditors and supervisory authorities bigger than small companies. As for the practical difficulties in applying IFRS, both small and medium-sized companies have difficulty in interpreting the standards and lacked guidelines. In order to resolve these difficulties, it is necessary to enhance the function of Q&A by the Korea Accounting standard board(KASB) or Financial Supervisory Service(FSS). In conclusion, the reliability of the financial statements of SMEs has improved with the introduction of IFRS. However, we believe that policy and institutional support is needed in order to have better financial reporting for SMEs.

• Journal of Digital Convergence
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• v.8 no.3
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• pp.143-154
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• 2010

This paper is to understand what effects the introduction of IFRS(International Financial Reporting Standard) will have on legacy AIS(Accounting Information System) and how to minimize the problems of that. In order to meet that purpose, we have to recognize the difference between K-GAAP(Korea-Generally Accepted Accounting Principles) and K-IFRS(Korea-International Financial Reporting Standards) first. And then we try to find out what effects the difference between K-GAAP and K-IFRS will have on the legacy AIS. In order to avoid the disorder When K-IFRS will be introduced to the company, new functions have to be added to existing system in proper manner and some existing functions should be changed correctly according to K-IFRS. And CIO(Chief Information Officer) should have to make a careful decision what is the better solution between in-house development and outsourcing for developing new system.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.9
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• pp.217-227
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• 2022

With the aim of examining the effects of implementing international financial reporting standards (IFRS) on teaching accounting and auditing at universities and colleges in Vietnam, a case study was conducted at 30 universities, colleges, and 208 lecturers in Vietnam. Next, the study employed the structural model analysis method by PLS_SEM software to process and analyze the collected data. The research results show that: (1) There are eight factors that affect how IFRS is applied to teaching, including the training program, (ii) teaching staff, (iii) IFRS application regulations, (iv) related party requirements, (v) faculty/school administrators, (vi) teaching aids, (vii) IFRS teaching methods, and (iii) students; (2) there are three factors that affect the quality of teaching staff, including applying IFRS to teaching at the university and colleges, (ii) Regulations on the application of IFRS, (iii) Requirements from related parties. At the same time, the study also shows that, regarding the indirect relationships, applying IFRS to teaching does not play an intermediary role in these relationships. However, at the 10% significance level, it was found that there is an indirect relationship between regulations on the application of IFRS by the Ministry of Finance and the quality of teaching staff through the variable applying IFRS to teaching.

• Proceedings of the Korean Society of Computer Information Conference
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• 2011.06a
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• pp.25-27
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• 2011

본 논문에서는 경제의 글로벌화를 반영하는 세계적인 현상인 국제회계기준 채택에 대하여 회계 관련사항을 내재하고 있는 기업의 전사적 관리 소프트웨어인 국산 ERP 시스템에 대하여 세금처리의 투명성을 향상시킬 수 있는 방법론적 모델을 해외 ERP의 장점을 통하여 연구한다. 국제회계기준은 기업요소에서 가장 중요한 자본의 국제적인 이동이 기본적 사항으로 기업의 소재지에 대한 국가표시와 관계없이 재무제표의 정보가 투명하고 비교 가능하도록 국제적으로 단일한 회계기준이 사용을 요구한다. 이러한 환경 변화에 따라 국제회계기준(International Financial Reporting Standards: IFRS)의 필요성과 중요성이 확대되어지고 있으며 국제회계기준위원회(International Accounting Standards Board: IASB)의 영향력까지 강화되어지고 있다. 본 논문은 국제회계기준에 맞춘 회계처리 부분의 투명성 향상 모델을 연구하기 위하여 국내에서 많이 사용되고 있는 국산 ERP 소프트웨어 프로그램에 대하여 국제회계기준과 상반되는 현상을 유발하는 기준이 되는 부분을 상호 보완할 수 있는 해외 ERP 소프트웨어 프로그램을 기반으로 기업 시스템을 분석, 구현한다. 국산 ERP 시스템의 국제회계기준 처리와 관련된 단점은 송장의 수정, 삭제가 용이하며 수정, 삭제 후 이력이 남지 않는 부분이다. 이 부분은 국제회계기준에서는 신뢰성에 대한 중대한 문제를 유발하므로 외산 ERP패키지의 장점인 수정과 삭제 단계가 계층적이며 수정, 삭제를 하더라도 필수적으로 이력전체가 저장되는 시스템을 연구하며 특히 세금처리 부분이 상이한 점을 보완하기 위한 모듈을 추가한다. 수정, 삭제에 대한 이력관리는 담당자의 전문적 능력평가와 동시에 실수와 오류부분에 대한 통계를 통하여 관리의 향상성을 추구하여 투명성이 향상된 모델 구축에 활용할 수 있다.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.12
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• pp.255-265
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• 2020

This study examines whether the adoption of International Financial Reporting Standards (IFRS) has increased financial statement comparability among firms and reduced undervaluation of Korean firms in the capital market by enhancing financial statement comparability. The so-called Korea Discount, which indicates an inefficient allocation of capital, has been attributed to lack of transparency and comparability of accounting information. Therefore, an efficient distribution of capital in the market was intended when IFRS was first adopted in Korea, but such progress is based on a premise of enhancement in Korean firms' accounting information comparability. This study conducts empirical analysis by using a comparability measure by De Franco et al. (2011). More specifically, it analyzes differences among comparability of domestic firms following IFRS adoption, with firms in the EU, which adopted IFRS in 2005, and with firms in the U.S., China and Japan that do not follow IFRS. The analysis of changes in domestic firms' comparability finds that their comparability improved following IFRS adoption. Meanwhile, the examination of cross-national differences in comparability demonstrates that, although there has been no significant change in comparability with firms in the U.S. and the EU across Korean industry since IFRS adoption, comparability with China has decreased while that with Japan improved.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.3
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• pp.17-27
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• 2020

The research aims to investigate the impact levels of determinants on the conversion of financial statements from Vietnamese accounting standards (VAS) to International financial reporting standards (IFRS) in the multinational firms in Vietnam. The method of data collection was done through the survey and subjects are accountants in Multinational Firms doing business in Hanoi and ten neighboring provinces. After checking the information on the votes, there are 170 questionnaires with full information for data entry and analysis. We use Cronbach's Alpha, EFA analysis and run regression model to investigate the impact levels of each independent variable on dependent variable of the conversion of VAS financial statements to IFRS. The results show that five determinants including Economic, Politics, Law, Culture, and Conditions for implementation have positive relationships with the conversion of VAS financial statements to IFRS. In particular, Economic determinant is the most strongest. Based on the findings, some recommendations are given for improving the conversion of VAS financial statements to IFRS of multinational firms doing business in the context of Vietnam. The results are considered a useful reference for firms when making financial statements to transparently change the financial statement information and improve the quality of financial statement information.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.3
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• pp.399-409
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• 2021

This study examines whether oil and gas companies comply with the requirements of the International Financial Reporting Standards (IFRS) 6 on Exploration and Evaluation (E&E) of Mineral Resources. For this purpose, a comprehensive checklist divided into eight different parameters was prepared by including every requirement of IFRS 6. While building on the previous studies, the annual reports of the top five Indian and top five Global companies engaged in this business have been investigated in detail against the checklist using content analysis as the research method. Results show that a majority of the companies (both Indian as well as global companies) have not been complying with the requirements of IFRS 6. In five out of eight parameters the companies have not complied with even half of the requirements. The overall compliance ratio is as low as 41.54 percent and 43.68 percent for Indian and Global companies respectively. While analyzing the non-compliance, it has been observed that despite having distinct accounting standards, different kinds of companies are reporting differently. Thus, it is not in line or consistent with the goal of IFRS i.e., to establish a universal language for the companies to prepare the accounting statements. The research findings identify the exact area of non-compliance while citing the relevant paragraph number of IFRS 6.