The Advantages and the Challenges of Adopting IFRS into UAE Stock Market

This paper aims to assess the benefits gained and the challenges experienced by companies listed on the UAE stock market following the introduction of IFRS. Since the announcement by the European Union to adopt IFRS by listed companies, many countries have followed suit, hoping to gain competitive edge in attracting the Foreign Direct Investment to boost their economic growth. This study focuses on examining the advantages and challenges faced by companies listed on the UAE stock market listed companies as a result of adopting IFRS. The framework used in this analysis will be based on the identification and assessment of key drivers influencing companies listed on the UAE stock market. To what extent are these factors internal or external to the financial sector, but which have a direct bearing on the overall economic environment? The views and perceptions of the Chief Financial Officers’ (CFOs) for Dubai and Abu Dhabi listed companies, financial analysts of the financial statements in the two listed companies and auditors will be analysed. Methodology: Questionnaires were used as the main method of data collection. Questionnaire were distributed in both Dubai and Abu Dhabi markets, The data obtained through the questionnaires have been imported into software for analysis, namely, the Statistical Package for the Social Sciences (SPSS). Findings: The results clearly show that the benefits of adopting IFRSs in UAE inevitably far outweigh the difficulties and costs. The findings also reveal that adoption of IFRSs in UAE stock markets has improved the overall standard of the quality of financial reporting, which help in attracting investors to invest in the UAE stock markets. However, many respondents were still apprehensive that effective and professional financial reporting decisions will be affected by the level of education of accounting users, the methods provided by some IFRSs, and the inadequate enforcement mechanisms. Keywords: IFRS, advantage, accounting standards, challenge, UA

Audit firm size and quality: Does audit firm size influence audit quality in the Libyan oil industry?

This study examines the relation between size of audit firm and audit quality, and the choice of accrual measures for a large sample of firms. In relation to the impact of different sizes of audit firms on audit quality, a clear majority of oil companies and audit firms agreed that Big Four firms are superior to their non-Big Four counterparts in all of the reputation issues presented to them, and that the size of the audit firm is positively associated with audit quality. Such superiority is seen in terms of resources and audit technology, and the consequent motivation to perform as professionally as possible. A questionnaire was used to collect data. To confirm and support the questionnaire findings, semi-structured interviews were conducted. The data used for this study were collected from two sources: the demand side (Libyan oil companies) and the supply side (audit firms working in Libya). The data for the Libyan oil companies were gathered from three different types of respondents: internal auditors, financial managers and accounts managers. For the audit firms, data were gathered from employees at all levels in the firm: managing partners, audit supervisors and auditors

The impact of adopting IFRS on profitability and stock performance in listed firms at Abu Dhabi and Dubai stock exchanges

This study aimed to investigate the main impact of adopting the International Financial Report Standards (IFRSs) on the users of financial reports in both the Dubai Financial Market (DFM) and the Abu Dhabi stock exchange (ADX). The study has also examined the impact of adopting the ·IFRS on profitability of firms and stock performance in the two stock markets. In addition, the study has investigated the different challenges that adopting the IFRS had in both Dubai and Abu Dhabi markets following the compulsory adoption of IFRS and whether the implementation of IFRS would have different impacts on the DFM from those in the ADX. One of the most important developments in the literature related to accounting and finance at the beginning of this century is concerned with the compulsory adoption of International Financial Reporting Standards (IFRSs) in Europe. With the introduction of IFRSs, there is the promise of the provision of financial statements that are more accurate and transparent and, therefore, the expectation of more value-relevance to investors when compared to local GAAP. Following the announcement that IFRSs were to be adopted by listed firms in the European Union in 2005, the accounting systems in developing countries have been affected, with countries, such as the United Arab Emirates (UAB), also announcing their desire to adopt the IFRS. However, as the nature of the business environment in the UAE is significantly different from that in western countries, serious argument arose between the users of financial reports in the UAB over whether the adoption of IFRSs was appropriate for their financial statements. The study has used two main methods to collect and analyse the primary data. Firstly, questionnaires were used to gauge how the preparers and users of financial reports view the adoption of IFRSs, in both DFM and ADX, and how this transition to IFRSs has affected their decision making. SPSS was used to analyse the collected data of the questionnaires using different tests such as t-test, ANOV A test, and Correlation test. Secondly, this study used the secondary data analysis to investigate the primary effects of adopting IFRS upon share performance and profitability of listed firms in the two stock exchanges. For the second data collection method, several multiple regression models were used based on the Ohlson and modified Ohlson models. The main findings of the study from the questionnaire indicate that most of users of the financial reports were in favour of the adoption of IFRSs in the UAB, however many of the users argued that the transition to IFRSs ought to be given careful consideration as it had negative effects on the accounting system of companies and raised the issue of lack of readiness and lack of competence of employees who are ill prepared for IFRSs. The findings of the questionnaire have also showed that the preparers at the banking sector were more satisfied with the adoption of IFRSs than was the case in other sectors. The results from the analysis of secondary data showed that the adoption of IFRSs had value-relevance for both the DFM and the ADX, with the greater relative impact being at the former. In addition, the analysis of results showed that the adoption of IFRSs had an impact on some financial indicators and this impact was higher in the ADX than it was in the DFM. The analysis also indicated that the adoption of IFRSs had a great impact on the trading volume of shares in both of the stock markets, with the impact being significantly higher in the ADX. In conclusion, as the main focus of the study was to examine the challenges and the impact of the recent adoption of IFRSs in one of the countries of the Middle East, this study has made a contribution to the literature on value-relevance in terms of stock performance and financial indicators. It has also shed light on an area of research which has been overlooked particularly in the Middle East

Evoking referred sensations of missing digits by electro-tactile stimulation: Preliminary tests

Sensory feedback is an important component in a prosthetic device. However, due to technological limits, current prosthetic digits aimed to treat partial hand amputations do not provide individuals with cutaneous touch feedback. In this work, we propose to employ electro-tactile stimulation to promote, by the application of stimulation electrodes on the palm, sensations relative to the missing digits. The promising findings of tests on 20 able-bodied participants are presented in this abstract