Volume 3 No 1 2004
FRRaG : The electronic journal of the Accounting Standards Interest Group of AFAANZ
ISSN 1449-2318
Editorial
Refereed section
Professional section
Index
Refereed articles
David Bence and Nadine Fry, "The International Accounting Standards Board's Search for a General Purpose Accounting Model"
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J-L.W. Mitchell Van der Zahn, "Association Between Gender and Ethic Diversity on the Boards of Directors of Publicly listed Companies in South Africa and Intellectual Capital Performance"
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Gunnar Rimmel, "Perceptions of Human Disclosures: Evidence from Annual Report Users of Two Corporations"
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Norita Mohd Nasir and Shamsul-Nahar Abdullah, "Voluntary Disclosure and Corporate Governance Among Distressed Firms in Malaysia"
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Professional comments
Janice Loftus, "What Do You Get When You Mix Measurement Methods and Pirnciples? - Accounting for Financial Instruments"
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Chris Deeley, "AASB 121: A New Approach to Translating Foreign Currency Financial Statements"
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Refereed articles
David Bence and Nadine Fry, "The International Accounting Standards Board's Search for a General Purpose Accounting Model"
Abstract:
In setting its standards, the International Accounting Standards Board (IASB) uses its 1989 'Framework for the Preparation and Presentation of Financial Statements'. Given developments since 1989, the Framework looks increasingly out-of-date. The authors argue that any new Framework should address the choice of income measurement. The general purpose accounting model would differ substantially from its predecessor, favouring 'fair value' as a valuation base within a ‘mixed measurement’ model. However, inadequate guidance may still be provided on the choice of capital maintenance concept and therefore, the search for a general purpose accounting model will continue.
J-L.W. Mitchell Van der Zahn, "Association Between Gender and Ethic Diversity on the Boards of Directors of Publicly listed Companies in South Africa and Intellectual Capital Performance"
Abstract:
This study addresses deficiencies in the corporate governance and intellectual capital literature by examining the association between the level of gender and ethnic diversity on the boards of directors of South African publicly listed firms and their degree of intellectual capital performance. A total of eighty-four South African publicly listed firms were included in this study. Empirical results indicated a positive association between the percentage of female and non-white directors on the boards of directors of South African publicly listed status and a firm’s intellectual capital performance. Additional analysis showed the designation of female directors as an insider had a negative effect of intellectual capital performance. Designation of female and non-white directors as outsiders had a positive influence on a firm’s intellectual capital performance. Finally, there was no association between the percentage of non-white inside directors on the boards of South African publicly listed firms and intellectual capital performance. Based on the results of this study, it is concluded South African publicly listed firms may be able to enhance their intellectual capital performance by utilizing a well balanced and structured board of directors in terms of gender and ethnic representation. Finally, for a conceptual perspective, the results of this study support the application of resource-dependence theory as a relevant theoretical framework to examine and explain factors influencing intellectual capital performance.
Gunnar Rimmel, "Perceptions of Human Disclosures: Evidence from Annual Report Users of Two Corporations"
Abstract:
This article presents findings from a micro study of human resource disclosures in two European insurance corporations. For the most part qualitative research methods were used to present and possibly understand users' perception of human resource disclosure patterns. Evidence from 18 in-depth interviews with European financial analysts showed that human resource disclosures are often perceived as too vague. However, vague human resource disclosures can still provide users with clues about both corporate management and employees. Finally, more structured and standardised human resource disclosure would be beneficial.
Norita Mohd Nasir and Shamsul-Nahar Abdullah, "Voluntary Disclosure and Corporate Governance Among Distressed Firms in Malaysia"
Abstract:
Voluntary disclosures have been extensively documented across markets, such as in the U.S., U.K. and the Asian region. This current study extends previous studies by examining the influence of firm’s financial status in explaining the level of voluntary disclosures in Malaysia. Financially distressed firms are the focus of this study because these firms face governance issues especially one that involves the role of the board of directors, audit committee and ownership structure. To this end, this paper attempts to determine whether voluntary disclosure is associated with financial status, corporate governance and ownership patterns. We examine the annual reports of distressed and matched healthy firms for financial years 2000 and 2001, a post economic downturn period. Our findings show that financially distressed firms had lower voluntary disclosures than their matched healthy firms. This evidence contradicts previous research by Skinner (1994, 1997) who provides evidence showing that firms with bad earnings news are more than twice as likely to pre-disclose their earnings performance than firms with good news. With regard to corporate governance variables, only board independence is found to have significant influence on the level of voluntary disclosures in the predicted direction. Audit committee independence, on the other hand, is not associated with voluntary disclosures. However, strong and consistent findings are documented with regard to ownership patterns. Our findings reveal that outside ownership is positively and significantly associated with the extent of voluntary disclosures, consistent with Hossain, Tan and Adams (1994) and Chau and Gray (2002). Further analysis also reveals that the extent of government-linked enterprises’ shareholdings influences the amount of voluntary disclosures, supporting the government’s initiatives to promote transparency. The extent executive directors’ shareholdings also has a positive influence to the voluntary disclosures level. However, non-executive directors’ interest and the separation of CEO roles from board chairmen are not associated with voluntary disclosures.
Professional comments
Janice Loftus, "What Do You Get When You Mix Measurement Methods and Pirnciples? - Accounting for Financial Instruments"
Abstract:
This paper describes the accounting treatments for financial instruments prescribed and permitted by AASB 132 and AASB 139. The mix of accounting treatments for financial instruments in the Standards provides an interesting case for examining the mixed measurement model. The analysis of the requirements focuses on the different measurement methods, principles and inconsistent bases for determining how to classify and measure assets, that have resulted from the lack of clear direction on measurement in the IASB Framework.
Chris Deeley, "AASB 121: A New Approach to Translating Foreign Currency Financial Statements"
Introduction:
This article provides a brief overview of the key requirements of AASB 121 relating to the translation of foreign currency financial statements. It illustrates an application of the new standard using an example borrowed from Appendix 1 of AASB 1012. It challenges a conventional notion that changes to an entity’s foreign currency translation reserve are ‘mere balancing numbers’ and demonstrates, possibly for the first time, how such changes can be independently calculated.
FRRaG: The electronic journal of the Accounting Standards Interest Group of AFAANZ, hosted by the School of Accounting, Curtin Business School