IFRS, financial reporting approach, earnings attributes and value relevance of intangible assets : empirical evidence from the UK

Strathclyde theses - ask staff. Thesis no. : T13385This study might interest academics, researchers, accounting regulators, practitioners and investors. Its main objective is to provide empirical evidence on how IFRS has affected earnings, intangible assets, financial reporting approach and the value relevance of intangible assets. This study hypothesises that the IFRS adoption would; increase earnings and intangible assets; have further shifted financial reporting approach towards a valuation approach; increase earnings volatility (reduce earnings persistence) and consequently increase the value relevance of intangible assets. The main methods of investigation are regression analysis. In accounting, reporting intangible assets remain controversial and challenging. IFRS to some degree would benefit U.K. investors if it increases reporting of intangible assets, particularly of different classes of intangible assets. However, existing research offers very little empirical evidence as most value relevance studies focus on earnings and book value of equity. This study reveals several key findings. First, earnings are significantly greater under IFRS but not at all different profit levels, which suggests that IFRS brings offsetting effects on earnings. However, IFRS produces mixed effects on earnings volatility and earnings persistence. Earnings are slightly more volatile but no significant impact on earnings persistence. Second, intangible assets are higher under IFRS and reporting of different classes of intangible assets is increasing. Third, this study documents broadly classified intangible assets are not value relevant which signifies the importance of specific classifications of intangible assets. Fourth, IFRS has minimal impact on the value relevance of intangible assets but intangible assets have significantly greater predictive value under IFRS. This study contributes to the existing literature by providing new findings on the impact of IFRS on accounting information in general and on intangible assets in specific. This study differs from prior study by several aspects. First, financial companies were not excluded but were separately analysed. Second, it further investigates the impact of IFRS on the two primary qualities for relevant information (informative and predictive values). Third, this study contributes to the literature by providing new empirical evidence on the value relevance of intangible assets and different classes of intangible assets. In the future, researchers can investigate the impact of adopting IFRS on the reliability of accounting information as reliability is the other specific quality for producing decision-useful information.This study might interest academics, researchers, accounting regulators, practitioners and investors. Its main objective is to provide empirical evidence on how IFRS has affected earnings, intangible assets, financial reporting approach and the value relevance of intangible assets. This study hypothesises that the IFRS adoption would; increase earnings and intangible assets; have further shifted financial reporting approach towards a valuation approach; increase earnings volatility (reduce earnings persistence) and consequently increase the value relevance of intangible assets. The main methods of investigation are regression analysis. In accounting, reporting intangible assets remain controversial and challenging. IFRS to some degree would benefit U.K. investors if it increases reporting of intangible assets, particularly of different classes of intangible assets. However, existing research offers very little empirical evidence as most value relevance studies focus on earnings and book value of equity. This study reveals several key findings. First, earnings are significantly greater under IFRS but not at all different profit levels, which suggests that IFRS brings offsetting effects on earnings. However, IFRS produces mixed effects on earnings volatility and earnings persistence. Earnings are slightly more volatile but no significant impact on earnings persistence. Second, intangible assets are higher under IFRS and reporting of different classes of intangible assets is increasing. Third, this study documents broadly classified intangible assets are not value relevant which signifies the importance of specific classifications of intangible assets. Fourth, IFRS has minimal impact on the value relevance of intangible assets but intangible assets have significantly greater predictive value under IFRS. This study contributes to the existing literature by providing new findings on the impact of IFRS on accounting information in general and on intangible assets in specific. This study differs from prior study by several aspects. First, financial companies were not excluded but were separately analysed. Second, it further investigates the impact of IFRS on the two primary qualities for relevant information (informative and predictive values). Third, this study contributes to the literature by providing new empirical evidence on the value relevance of intangible assets and different classes of intangible assets. In the future, researchers can investigate the impact of adopting IFRS on the reliability of accounting information as reliability is the other specific quality for producing decision-useful information

Combining grounded theory and case study methods in IT outsourcing study

Most early studies in information technology or system (IT/IS) predominantly apply quantitative techniques. However, application of qualitative methods is increasing in IT/IS researches and become a new trend among the researchers in the past twenty years. Using case studies are the most common methods to explore the research subjects. Recently, grounded theory method is becoming popular among doctoral candidates in their theses and also by researchers in reputable journals. In this research, the authors applied Simon’s model to investigate IT outsourcing case studies using both grounded theory and case study researches approaches. The authors, then, describe and discuss on grounded theory and case study methods and how they can be combined in an IT/IS study. The accounts of IT outsourcing study in Malaysia public healthcare agencies are chosen as an example. The study shows that application of both methods adds to rigorous, novelty and reliable theory building approach. Grounded theory and case study research did provide synergies in IS research particularly in providing rigorous and reliable iterative data collection and analysis to generate themes and an emerging theory. Moreover, there is a synergistically combination between case study research and grounded theory, demonstrating that qualitative approach is vibrant and flexible. We recommend future doctoral candidates to apply these two qualitative methods hand in hand

An empirical study on the risk management strategies IT outsourcing in Malaysia public sector

The complexities of IT outsourcing (ITO) projects require an emphasis on proper and effective project risk management strategies adopted by both service receivers and providers. Literature indicates that an alarming number of mega-deal ITO deals failed due to many reasons. For instance, ill-planned and poorly-managed projects, large and multifaceted projects are more risky and contextual issues are highly influential. In addition, in more complex project commissioning and development where political and organisational elements come to the fore further aggravates the need for proper risk managements. Moreover, an informed selection of an adequate pricing model indeed plays a crucial, if not decisive, role to ensure a successful deal outcome and to mitigate risks in the wake of the deal. Above all, the private versus public paradigms delineate borders on the needed priorities that require appropriate strategies to be adopted suitable in each environment and circumstances. Literature shows that this risk management strategy in ITO area is still under-researched and therefore provides a gap for future research. This study attempts to fill in this void. In this study, we adopt a qualitative case study approach to investigate on the ITO project success experiences from five public sector agencies. Content analysis was used to analyse available documents and in-depth semi-structured interview feedbacks. The study finds the agencies have applied ITO guidelines recommended by Malaysia public sector IT modernisation and administrative planning unit. Moreover, the project management approaches and standards adopted were different among project managers. However, the formal and informal communication channels were used in all cases to enhance the relationship between all stakeholders. Nevertheless, the SP adopted methodologies and standards were either internally developed or well recognised project management methodologies in the five projects. Finally, the study contributes by filling up the literature gap and providing empirical evidence on ITO risk and risk management strategies adopted in the public healthcare sector

The relationship between corporate governance disclosures and balance sheet ratios / Sharifah Norhafiza Syed Ibrahim, Halizah Md Arif, Halil Paino

One of the major issues raised during the financial crisis in 1997-1998 was corporate governance practice. As a result, corporate governance reforms were then instituted and efforts were made to improve the corporate governance practices by the corporate sector. In the year 2000, The Malaysian Code of Corporate Governance was launched with a view to promote better disclosure and transparency, board effectiveness and independence and shareholder rights and activism. This paper attempts to discuss relationships between corporate governance disclosures and key balance sheet ratios among Malaysian listed companies

Geographical Information System (GIS) as an Innovative Adoption to Ease Customers in Locating SME Business Premises in Malacca

Geographical Information System (GIS) is one of the recent innovation to ease users in locating places. GIS is a system designed to capture, store, manipulate, analyze, manage, and present all types of spatial or geographical data. It can also be used by customers in locating business premises. Research related to application of GIS in locating SME business premises especially in Malacca as a tourist state is still very limited. This study used a survey method to produce more generalizable findings. Quantitative procedures for data collection and analysis were rigorously applied to ensure reliability and validity of the findings. A total of 160 usable responses was collected from 400 distributed questionnaires. This study found all variables significant and therefore, all hypotheses were accepted. In the future, researchers may extend this study to other areas to understand more about current usage patterns and reasons for its adoption. Studies which cover non-Malaysian respondents and different education levels can further document different perspectives of GIS adoption

Geographical Information System (GIS) as an Innovative Adoption to Ease Customers in Locating SME Business Premises in Malacca

Geographical Information System (GIS) is one of the recent innovation to ease users in locating places. GIS is a system designed to capture, store, manipulate, analyze, manage, and present all types of spatial or geographical data. It can also be used by customers in locating business premises. Research related to application of GIS in locating SME business premises especially in Malacca as a tourist state is still very limited. This study used a survey method to produce more generalizable findings. Quantitative procedures for data collection and analysis were rigorously applied to ensure reliability and validity of the findings. A total of 160 usable responses was collected from 400 distributed questionnaires. This study found all variables significant and therefore, all hypotheses were accepted. In the future, researchers may extend this study to other areas to understand more about current usage patterns and reasons for its adoption. Studies which cover non-Malaysian respondents and different education levels can further document different perspectives of GIS adoption

Motivating Factors for Sustainable Accountant Potentials in Malaysia

Economic Transformation Plan (ETP) emphasizes that the country has a pool of resources to steer towards Malaysia’s aspirations to become a developed and high-income nation. The ETP Roadmap highlights accountancy, an integral function in all businesses as part of the significant ETP driver. However, Malaysia still lacks the required number of qualified accountants by the year 2020. This challenges higher learning institutions to produce suitable accounting graduates. Despite taking an accounting subject in schools, not all these students later opt to enrol accounting in higher learning institutions as many factors influence their career choices. This study aims to explore these motivating factors. A quantitative approach was applied whereby primary data were collected through a questionnaire survey. Respondents were students from seven elite schools in Melaka. The study found eight motivating factors; family members in the accounting profession, public accountant as a career choice, students’ interest in receiving relevant information, choosing private accountants as a career, parents, school counsellor and career talk. However, only four of these factors were significant to students’ decisions to pursue professional accounting courses. In addition, parents’ influence plays a greater role in motivating students to opt for professional accounting courses as compared to an accounting degree