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Fair Value Measurement Disclosures: Particularities In The Context Of Listed Companies And European Funding

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  • Dumitru MatiÅŸ
  • Maria Ionela Damian
  • Carmen Giorgiana Bonaci

Abstract

In the last years and especially after the outbreak of the recent financial and economic crisis, fair value and implicitly fair value measurements for financial statements have been harshly criticized, mainly by the representatives of the companies activating in the financial sector. Therefore, the aim of this paper is to study the issue of disclosures on fair value measurements in the financial statements by firstly sketching a guide of best practices and further focusing on empirically documenting potential determinants. In order to achieve the objective of our study, the employed methodology draws on similar studies in research literature, calculating for each company included in the study a disclosure score called disclosure index and then using a statistical program to run a multivariate linear regression. The obtained results document, among other, that the entity size positively affects the fair value measurements disclosure index. Particularities regarding fair value measurement related disclosures are discussed in the context of European funding (subsidies). Our study therefore contributes (through the developed empirical study) to the literature on the determinants of companies' disclosure practices in the particular area of fair value measurements.

Suggested Citation

  • Dumitru MatiÅŸ & Maria Ionela Damian & Carmen Giorgiana Bonaci, 2013. "Fair Value Measurement Disclosures: Particularities In The Context Of Listed Companies And European Funding," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(15), pages 1-3.
    • Handle: RePEc:alu:journl:v:1:y:2013:i:15:p:3
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    References listed on IDEAS

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    1. Core, John E., 2001. "A review of the empirical disclosure literature: discussion," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 441-456, September.
    2. Nicolas Véron, 2008. "Fair value accounting is the wrong scapegoat for this crisis," Policy Contributions 19, Bruegel.
    3. Christine A. Botosan & Marlene A. Plumlee, 2002. "A Re‐examination of Disclosure Level and the Expected Cost of Equity Capital," Journal of Accounting Research, Wiley Blackwell, vol. 40(1), pages 21-40, March.
    4. Kothari, S. P., 2001. "Capital markets research in accounting," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 105-231, September.
    5. El-Gazzar, Samir M. & Finn, Philip M. & Jacob, Rudy, 1999. "An empirical investigation of multinational firms' compliance with International Accounting Standards," The International Journal of Accounting, Elsevier, vol. 34(2), pages 239-248, June.
    6. Marie Chavent & Yuan Ding & Linghui Fu & Herve Stolowy & Huiwen Wang, 2006. "Disclosure and determinants studies: An extension using the Divisive Clustering Method (DIV)," European Accounting Review, Taylor & Francis Journals, vol. 15(2), pages 181-218.
    7. Healy, Paul M. & Palepu, Krishna G., 2001. "Information asymmetry, corporate disclosure, and the capital markets: A review of the empirical disclosure literature," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 405-440, September.
    8. Street, Donna L. & Gray, Sidney J. & Bryant, Stephanie M., 1999. "Acceptance and Observance of International Accounting Standards: An Empirical Study of Companies Claiming to Comply with IASs," The International Journal of Accounting, Elsevier, vol. 34(1), pages 11-48.
    9. Adriana Tiron-Tudor & Raluca Valeria Raţiu, 2010. "How Transparent Are Companies Listed On The Bucharest Stock Exchange When Disclose Them Consolidated Financial Statements?," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(12), pages 1-17.
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    Cited by:

    1. Zamora-Ramírez, Constancio & Morales-Díaz, José, 2018. "The Use of Fair Value Measurement in Financial Reporting: A Literature Review/La Utilización del Valor Razonable en la Contabilidad: Revisión de la Literatura," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 36, pages 489-514, Mayo.
    2. Catalina Gorgan & Vasile Gorgan, 2014. "Study On Disclosure Level Of Companies Listed On The Bucharest Stock Exchange In Accordance With International Financial Reporting Standards: The Case Of Intangible Assets," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 104-115, April.

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    More about this item

    Keywords

    fair value; valuation; financial statements; disclosure index; determinants; European funding (subsidies).;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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