Effects of adopting IFRS 10 and IFRS 11 on consolidated financial statements: an exploratory research

Purpose: This paper investigates how the adoption of IFRS 10 and IFRS 11 affected consolidated financial statements. Specifically, the paper explores whether entities adopted mandatorily or voluntarily both IFRS, whether expressly declared effects, whether considered those effects as material and whether those effects had impacts on selected items of financial statements and on selected financial ratios. Design/methodology/approach: The research is an exploratory study using public entities from France, Germany and the United Kingdom. The majority of the data are manually collected from financial statements. Findings: The results suggest that the adoption of the new IFRS 10 affected the composition of a large number of entity groups but that their financial information and economic-financial indicators do not present material changes. There is also evidence of a large and material impact on the changes in the classification and accounting for interests in arrangements under joint control through the new IFRS 11. The evidence thus suggests unequal effects of the adoption of IFRS 10 and IFRS 11 on the proportion of entities declaring materiality of effects, on the quantitative effects on selected items of financial statements, and on financial ratios. A comparison between the pre-adoption and post-adoption periods reveals that the majority of the effects are driven by the adoption of IFRS 11. Originality/value: This exploratory paper is the first presenting the effectiveness of adopting the most important standards under the “consolidation package” and opens an avenue for future research by academics, for future post-implementation reviews by IASB, and for analysis of peer reviews between accounting practitioners.info:eu-repo/semantics/acceptedVersio

The drivers of intellectual sustainability in a regional agriculture, cattle, and forest farmstead

Intellectual capital drivers emerge in the national and regional economies as a key source of integrated sustainability. The company analyzed in the case study is the largest Portuguese agriculture, cattle, and forest farmstead, covering several marshlands. As the largest agricultural company, its primary mission is the cost effectiveness and efficient management of their agricultural and environmental heritage, in respect for biodiversity and for environmental values. Located in the region of Lisbon and Tagus valley, the diversity of their activities (forest exploration; hunting; agriculture; wines and olive oil production; and tourism) requires an integrated research towards the identification and disclosure of drivers that best contribute for company reputation and turnover. Through a descriptive and interpretive case study approach, a set of intellectual sustainability drivers (e.g. forest’s certification, brands’ certifications, commercial brands, commercial agreements, R&D projects, protected areas classification, etc.) were identified and categorized. All of them were aggregated in five categories, such as Certification, Brands and Trademarks, Awards, Alliances and Networks, and Biodiversity Reputation. As a regional and national source of economic development, that categorization can also provide the basis for a theoretical framework towards the design of an intellectual sustainability scoreboard, applicable to similar organizations worldwide

The drivers of intellectual capital in an agriculture, cattle and forest farmstead

The pursuit of economic value, especially in the organizational context, has risen into a diversity of new concepts that reflect the genesis and importance that knowledge has been assumed in fields of companies’ strategies and performance. Intellectual capital has been emerged in the economic literature as knowledge capital which is embodied in knowledge-based organizations, driven them through multiple learning organizational processes. From a wholly accounting approach, it has been scanned and reported as intangible assets, source in itself of sometimes abnormal expected future returns. The identification of its multiple dimensions can be attained through two complementary orientations of thought: through a strategic approach, related to the creation and use of knowledge and its articulation with the dynamic value creation and, complimentarily, through the construction of new information systems and performance measures which are beyond the traditional financial approaches and measures. It is an approach that embodies the importance and the need to spread the unseen side of organizations. Its main aim is to translate and disseminate the companies’ real value, its own and invisible drivers, and identify the origin of their multiple inflows and returns. The company under analysis is the largest agriculture, cattle and forest farmstead in Portugal, covering several marshlands. The diversity of activities currently developed (Forest exploration; Hunting; Agriculture; Wines and olive oil production; and Tourism) requires an integrated research towards the construction and disclosure of its intellectual capital drivers. Through an experimental and interpretative case study approach, we seek for an integrated intellectual capital scorecard towards the organizational development and sustainability. In the first step of this research, it was possible to identify several sustainability drivers, namely forest management certification, commercial brands and awards, strategic alliances and networks, and biodiversity reputation.info:eu-repo/semantics/publishedVersio

Development expenditures as source of revenue and market valuation: evidence from the Iberian cluster

Over the last decades, companies have been aligning its strategy with focus on research and development activities, towards future economic benefits. These innovative activities are, in many cases, associated to changes by introducing new methods, ideas, processes, products, and learning practices. Innovation also translates the ability to produce and transform knowledge, contributing to potential economic returns. The current research aims to identify whether development expenditures (application of research findings or other knowledge), recognized in the firms’ annual statement of financial position, have a significant impact on Iberian firms’ revenues and on market valuation. Based on the 68 Iberian non-financial listed companies, with active development projects over the period 2010-2015, an econometric framework was regressed. Portugal and Spain are significantly aligned on the impact of development expenditures on predicting firm’s revenue and firm’s market valuation. This intangible asset, when managed together with other intangible resources, can generate higher value-added inflows, if compared with its isolated effects. Research didn’t evidence any significant time effects neither activity sector effects.info:eu-repo/semantics/acceptedVersio

Solar activity during the Holocene: the Hallstatt cycle and its consequence for grand minima and maxim

Cosmogenic isotopes provide the only quantitative proxy for analyzing the long-term solar variability over a centennial timescale. While essential progress has been achieved in both measurements and modeling of the cosmogenic proxy, uncertainties still remain in the determination of the geomagnetic dipole moment evolution. Here we improve the reconstruction of solar activity over the past nine millennia using a multi-proxy approach. We used records of the 14C and 10Be cosmogenic isotopes, current numerical models of the isotope production and transport in Earth's atmosphere, and available geomagnetic field reconstructions, including a new reconstruction relying on an updated archeo-/paleointensity database. The obtained series were analyzed using the singular spectrum analysis (SSA) method to study the millennial-scale trends. A new reconstruction of the geomagnetic dipole field moment, GMAG.9k, is built for the last nine millennia. New reconstructions of solar activity covering the last nine millennia, quantified in sunspot numbers, are presented and analyzed. A conservative list of grand minima and maxima is provided. The primary components of the reconstructed solar activity, as determined using the SSA method, are different for the series based on 14C and 10Be. These primary components can only be ascribed to long-term changes in the terrestrial system and not to the Sun. They have been removed from the reconstructed series. In contrast, the secondary SSA components of the reconstructed solar activity are found to be dominated by a common ~2400-yr quasi-periodicity, the so-called Hallstatt cycle, in both the 14C and 10Be based series. This Hallstatt cycle thus appears to be related to solar activity. Finally, we show that the grand minima and maxima occurred intermittently over the studied period, with clustering near highs and lows of the Hallstatt cycle, respectively.Comment: In press in Astronomy & Astrophysics, doi: 10.1051/0004-6361/20152729

Culture dimensions and application of IFRSs in the banking industry

Using European and Asian banks, this paper investigates how differences in culture in different countries can be related with Loan loss provisions (LLP) based on the Hofstede’s theory. The effect of the application of International Financial Reporting Standards (IFRSs) on the amount of LLP recognized in financial statements published by Banks is also under analysis. Findings suggest that some culture dimensions play a role when analyzing risk factors, but not in all situations. When scores based on characteristics and behavior attributable to national culture are conflicting, the influence of culture on loan loss provisions is rejected. However, the application of IFRSs (vs local GAAP) has an important role, changing the power of national culture to influence the levels of LLP in countries where the scores of culture dimensions are according to the theory, and mitigating that influence when the scores are conflicting, moderating the amount of LLP that Banks should report regardless of culture behavior.info:eu-repo/semantics/publishedVersio

La participación de organismos de América Latina en el IASB: Un papel creciente de actualización e de influencia

Accounting in Latin American countries has potential to become an important topic for research. These countries, integrated in emergent economies, have been increasing an important role in the global economy. The main objective of this paper is to put in evidence the role, efforts and influence of multiple standard-settings and supervisory entities from Latin American countries (LATAM) on the IASB’ standards making process, with a particular emphasis in 2010 onwards. The results show that the increased participation of LATAM countries in an international context is important for understand the high degree of convergence of local standards to international accounting standards.info:eu-repo/semantics/publishedVersio

Are intangibles really a source of future economic benefits? Evidence from the technology sector

Identify the impact of intangibles as drivers of economic future benefits, in the top technological companies in the world. It also aims to identify whether the distribution of those intellectual capital drivers depend on the region and on the accounting standards, used in the preparation of firms’ financial reporting. Using information from the major technological firms for a range of time of five years, a set of intellectual capital proxies were identified and regressed. Three linear models were used, and hypotheses were performed towards the identification of significant impacts on firms’ turnover prediction. A set of intangibles were identified as significant drivers of firms’ turnover. Results suggest that the distribution of those proxies differ among regions and depend on the accounting standards. Firms from North-American evidence higher levels of intangibles, their boards composition is differentiated, additionally tending to increasingly invest in R&D activities. In spite of the limitations, we underline the sample size. However, the current approach can be replicated over time, and based in other rankings, applicable to other activity sectors and using different metrics. Based on the major technological firms worldwide, research adds value to the already known scope of intangibles, by providing additional and complimentary outcomes. A new direction, based on the scope of intangibles accounting standards used in the preparation of financial statements, was flagged towards theory and practice alignment. This research adds value to the current literature by exploring the effects of intangibles in the major technological companies in the world. Focused in a sector strongly marked by innovative strategies, it provides a new and complimentary overview.info:eu-repo/semantics/acceptedVersio

Development expenditures towards firm's turnover and firm's market valuation: Evidence from Portugal and Spain

Countries and firms became a very heavy spender on R&D and on education and training with an increasingly focus based on innovation. It is associated to changes by introducing new methods, ideas, or products. It also translates the ability to produce and transform knowledge, contributing to potential economic inflows. The current research, in the scope of business enterprise R&D intensity policy and European Union strategy 2020, aims to identify whether development expenditures in business enterprises have a significant impact on Portuguese and Spanish firms' economic returns and firm's market valuation, as well as to provide an overview on the convergence with European innovation strategy. Based on 68 Iberian non-financial listed companies, all of them with active development projects on innovation, an econometric framework was regressed. Without convergent R&D main funding source and national targeting rates, Portugal and Spain are significantly aligned on the impact of development expenditures on firm's turnover and on firm's market valuation. If managed together, firms can generate high value-added flows, from those innovative intangible resources.info:eu-repo/semantics/acceptedVersio

An atomic Hong-Ou-Mandel experiment

The celebrated Hong, Ou and Mandel (HOM) effect is one of the simplest illustrations of two-particle interference, and is unique to the quantum realm. In the original experiment, two photons arriving simultaneously in the input channels of a beam-splitter were observed to always emerge together in one of the output channels. Here, we report on the realisation of a closely analogous experiment with atoms instead of photons. This opens the prospect of testing Bell's inequalities involving mechanical observables of massive particles, such as momentum, using methods inspired by quantum optics, with an eye on theories of the quantum-to-classical transition. Our work also demonstrates a new way to produce and benchmark twin-atom pairs that may be of interest for quantum information processing and quantum simulation