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Accounting Standards and Market Value of Firms with Pension Plans

Author

Listed:
  • Sara Paralta

    (PhD in Economics – Paris Dauphine University – France,University Professor, Present address: Atlântica University, Fábrica da Pólvora de Barcarena, 2730-036 Barcarena, Portugal,)

Abstract

This article investigates the impact of the adoption of International Accounting Standards on the market value of non-financial listed firms of the Euronext Lisbon Stock Exchange, in the PSI-20. The study of the impact of these standards is focused on the items of the Financial Statements, particularly on items subjected to the criteria of the fair value of assets and liabilities of pensions. Most of these companies have obligations to pay annuity benefits, particularly for retirement, which are managed by outsourced independent companies, such as pension funds and life insurance companies. By using a panel of the largest non-financial companies during the period 2004-2010, the results show that the setting of the fair value of those liabilities in the post-2005 period affects the market value of firms, not only on account of the adoption of the standards, but also due to the effect of the 2008 stock market crash.

Suggested Citation

  • Sara Paralta, 2014. "Accounting Standards and Market Value of Firms with Pension Plans," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 4(11), pages 31-42, November.
    • Handle: RePEc:mir:mirbus:v:4:y:2014:i:11:p:31-42
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    File URL: http://thejournalofbusiness.org/index.php/site/article/view/654/480
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    References listed on IDEAS

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    More about this item

    Keywords

    Companies valuation; financial crisis; International Accounting Standards (IAS); IFRS; pension plans.;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General

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