Did financial reporting quality improve after the adoption of IFRS in Greece?
SubjectInternational business enterprises -- Accounting -- Standards ; Financial statements ; Financial reporting -- Standards -- International co-operation ; Accounting -- Standards
In 2002, the European Union Parliament enforced a common set of accounting regulations for all listed companies across the European Union (EU). The application of International Financial Reporting Standards (IFRS) in Europe was introduced to improve the accounting quality and corporate financial statements. This study examines whether the application of IFRS improved the financial reporting quality in Greece. The sample we use consists of 80 Greek listed firms. The metrics used to evaluate financial reporting quality are earnings management, timely loss recognition, and value relevance. The results showed that firms which adopted IFRS experience less earnings management, more timely loss recognition, but, contrary to our predictions, less value relevance of accounting amounts.