IDEAS home Printed from https://ideas.repec.org/a/eme/rafpps/v12y2013i3p286-304.html
   My bibliography  Save this article

Market assessment of intangibles and voluntary disclosure about innovation: the incidence of IFRS

Author

Listed:
  • Marie‐Josée Ledoux
  • Denis Cormier

Abstract

Purpose - The purpose of this paper is to investigate the incidence of International Financial Reporting Standard (IFRS) on stock market assessment of intangibles and voluntary disclosure about innovation. Design/methodology/approach - The authors develop three regression models. The first model investigates the stock market valuation of intangible assets and disclosure about innovation. The second model desegregates earnings to assess the relevance of components related to intangibles. The third model investigates how intangible expenses and voluntary disclosure affect analysts forecast dispersion. Findings - Results show that the value relevance of intangible assets and expenses improves with the adoption of IAS 38. Overall, results indicate a decrease in the value relevance of voluntary disclosure about innovation under IFRS. More specifically, results suggest some overlap in the information content of mandated and voluntary disclosure for stock market valuation of intangible assets under IFRS. Findings also suggest that voluntary disclosure moderates market's assessment of expensed intangibles under both Canadian GAAP and IFRS. Research limitations/implications - IAS 38 requires entities to recognize an intangible asset if certain criteria are met and to disclose specific information about it. In such a context, market participants may refer to a greater extent to financial reporting and to a lesser extent to voluntary disclosure when valuating intangibles. Practical implications - Managers will have an incentive to better target their communications to ensure a degree of complementarity with financial reporting. In this sense, this study contributes to the voluntary disclosure literature. Originality/value - To the best of the authors' knowledge, this is the first study to investigate the relationship between mandatory disclosure and voluntary disclosure about intangibles and evaluate the impact of IFRS on this matter.

Suggested Citation

  • Marie‐Josée Ledoux & Denis Cormier, 2013. "Market assessment of intangibles and voluntary disclosure about innovation: the incidence of IFRS," Review of Accounting and Finance, Emerald Group Publishing Limited, vol. 12(3), pages 286-304, August.
  • Handle: RePEc:eme:rafpps:v:12:y:2013:i:3:p:286-304
    DOI: 10.1108/RAF-Apr-2012-0033
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/RAF-Apr-2012-0033/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://www.emerald.com/insight/content/doi/10.1108/RAF-Apr-2012-0033/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://libkey.io/10.1108/RAF-Apr-2012-0033?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. María Dolores García-Gallo & Félix Jiménez-Naharro & Miguel Torres-García & Susan L. Giesecke & José Guadix-Martín, 2020. "Incorporation of the Intangibles into the Spanish Start-Ups by Activity Sector and Region. Improving Their Economic Sustainability," Sustainability, MDPI, vol. 12(10), pages 1-20, May.
    2. Zulfikar Ikhsan Pane & Roy Sembel & Yvonne Agustine, 2021. "Street earnings as a mediator of the effect of intellectual capital disclosure, customer value, and research development activities on firm value," Technium Social Sciences Journal, Technium Science, vol. 25(1), pages 242-259, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:rafpps:v:12:y:2013:i:3:p:286-304. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.