Assessing the value relevance of accounting data after the introduction of IFRS in Europe

Alain Devalle*, Enrico Onali, Riccardo Magarini

*Corresponding author for this work

Research output: Contribution to journalArticle

Abstract

Since 2005, European-listed companies have been required to prepare their consolidated financial statements in accordance with the International Financial Reporting Standards (IFRS). We examine whether value relevance increased following the introduction of IFRS, using a sample of 3,721 companies listed on five European stock exchanges: Frankfurt, Madrid, Paris, London, and Milan. We find mixed evidence of an increase in value relevance. However, the influence of earnings on share price increased following the introduction of IFRS in Germany, France, and the United Kingdom, while the influence of book value of equity decreased (except for the United Kingdom).

Original languageEnglish
Pages (from-to)85-119
Number of pages35
JournalJournal of International Financial Management and Accounting
Volume21
Issue number2
Early online date13 Apr 2010
DOIs
Publication statusPublished - 2010

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