The study discusses the European equity market and the reactions of the European investors over the change in the financial reporting rules and regulations. The study examines the introduction of the International Financial Reporting Standards (IFRS) and the impact this reporting change had on the investors' perception of the financial reporting. Most of the firms in the early part of the new millennium were using domestic standards for financial reporting. An introduction of a financial standard of reporting may result in repulsion from the investors and the entire financial market. This study examined the adoption of the International Financial Reporting Standards and the European stock market reaction with the help of sixteen events.
The writers in this report are qualified in their field from their respective universities. They have used data from all the stack markets of Europe and done tests regarding the elements which would measure the investors' response to this larger than life change in the reporting standard for Europe. The studied the quality financial reporting information, thereby lowering information asymmetry, as a result of implementation of this reporting rule. They performed tests on the individual firms as well to find out the firms and their investors combine reaction regarding this change. The reliability of this research stems from the intricate detains and the tests run by the researchers to reach the conclusion of the research.
This research is useful for the investors in better understanding the International Financial Retorting Standards applied by the International Accounting Standard Board (IASB). This research discusses both the benefits of the new reporting requirements in terms symmetry of information and the convergence implications arising from the new reporting law. Thus, the debate was
Cunningham, Colleen. (2010). IFRS in the U.S. - Will U.S. ever be converged completely? Corporate Finance Insider. The writer of this article emphasis the International Financial Reporting Standards (IFRS) as introduced by the Security Exchange Commission (SEC) in the United States. This article talks about the one standard of reporting through out the United States. This one standard will reduce the asymmetrical information and will bring the financial markets closer - the conversion benefits of the markets. The writer talks about the SEC road map of the IFRS for the firms operating in the company. As opposed to the researches conducted on this topic this article summarizes the total process of upgrading the financial reporting process in order to standardize and revolutionized the reporting in the financial market.
The author has an in-depth view of the entire process of the reporting revolution. She tracks all the events from the initial planning to the implementation of the new reporting standards by the SEC. This article gives legitimate information about how the SEC is dealing with the absorption of the new reporting regulation.
This article is useful in terms of understanding the US perspective of the IFRS and its implementation in the United States. One can use this article as a comparison study with other researches done on this topic for other parts of the world. All the world these days is going towards the convergence of the financial market. The implementation of the IFRS for the markets of US and the rest of the world will result in the asymmetric information and will be beneficial for the firms and their investors. Thus, this article is useful in improving my knowledge about the US understanding and implementation of the new reporting laws.