The Experts below are selected from a list of 282 Experts worldwide ranked by ideXlab platform

Wendy Rotenberg - One of the best experts on this subject based on the ideXlab platform.

  • Harmonization of Foreign Currency Translation practices: Canadian treatment of long term monetary items
    The International Journal of Accounting, 1998
    Co-Authors: Wendy Rotenberg
    Abstract:

    Abstract The harmonization of accounting practices requires that local practices be restricted. An example is the outstanding proposal to change the Canadian accounting treatment of Foreign debt. Proposed changes include elimination of the deferral and amortization of Translation adjustments; a uniquely Canadian accounting treatment that is now at odds with internationally accepted practices. The likely result will be greater recognition of Translation adjustments in current earnings. This study is the first to examine the impact of the proposed changes on the reported leverage and profitability of Canadian companies. The impact is found to be significant.

George Emmanuel Iatridis - One of the best experts on this subject based on the ideXlab platform.

  • An empirical assessment of special accounting issues and financial attributes relating to the accounting treatment of Translation gains and losses: the UK case
    Review of Accounting and Finance, 2007
    Co-Authors: George Emmanuel Iatridis
    Abstract:

    Purpose – This paper aims to assess the financial performance of firms that adopted or deferred the adoption of SSAP 20 “Foreign Currency Translation”. The focus of the study is to examine the impact of certain accounting issues, such as liquidity, hedging, Foreign Currency loans, managerial compensation, pre‐ and post SSAP 20 treatment of Translation differences, etc, on the behaviour of firms.Design/methodology/approach – The paper follows the positive accounting theory context and utilises parametric (logistic regression) and non‐parametric (Kruskal–Wallis test) tests to form and test theoretical hypotheses and relations between groups of firms with different financial characteristics.Findings – The study provides evidence that the implementation of SSAP 20 has overall strengthened the financial position of adopters. Adopters that used different Translation methods prior to adoption tend to exhibit different financial characteristics (e.g. higher leverage) in the pre‐actual adoption period. In contrast...

  • Characteristics of UK firms related to timing of adoption of Statement of Standard Accounting Practice No. 20
    Accounting and Finance, 2006
    Co-Authors: George Emmanuel Iatridis, Nathan Lael Joseph
    Abstract:

    This study examines whether the timing of adoption of the UK Statement of Standard Accounting Practice No. 20 'Foreign Currency Translation' depended on firms' financial characteristics. Consistent with US studies, we find that early adopters tended to be larger firms, and that variables, such as growth options, profitability, leverage and management payout, have strong predictive power. In general, the decision to adopt the Statement of Standard Accounting Practice No. 20 did not appear to adversely affect the profitability measures or dividend payout. Firms tended to adopt when the adverse economic consequences of the adoption were likely to be minimal. They also appeared to defer the adoption of the standard to influence their financial performance and, hence, to achieve certain corporate financial objectives. © 2006 AFAANZ.

  • An empirical investigation of the UK stock market response to the implementation of SSAP 20 "Foreign Currency Translation"
    Investment management & financial innovations, 2005
    Co-Authors: George Emmanuel Iatridis, Nathan Lael Joseph
    Abstract:

    This study presents an empirical investigation of the UK stock market response to the im-plementation of the UK Statement of Standard Accounting Practice (SSAP) No. 20 “Foreign Cur-rency Translation” (issued in April 1983). Such an empirical investigation has not yet been under-taken for the UK. Our results show that the stock market generally appeared to have anticipatedthe implementation of SSAP 20. For the aggregate set of adopters, we found a positive stock mar-ket response in the official year of adoption, reflecting the appreciation of the income-stabilisingeffects of the standard. This paper also presents a cross-sectional analysis that tests for a relation-ship between the stock returns and the accounting measures of those firms that adopted SSAP 20.We found a significant relation between the stock returns and the related accounting measures inthe actual adoption period of the aggregate set of adopters. This study generally focuses on theinterpretation of the financial impacts of the various accounting choices of firms within their fi-nancial and economic environments.

  • Translation gains and losses and firms' accounting choices: UK evidence on and before SSAP No. 20
    International Journal of Accounting Auditing and Performance Evaluation, 2004
    Co-Authors: George Emmanuel Iatridis
    Abstract:

    In the light of Foreign exchange (FX) rate fluctuation, this paper concentrates in the accounting choices of firms and their motivation to adopt or defer the adoption of the UK Statement of Standard Accounting Practice (SSAP) No. 20 "Foreign Currency Translation". The paper provides evidence that the implementation of SSAP No. 20 has improved the financial accounting measures of firms, such as profitability and leverage. The effects of the standard tended to be more substantial for adopters that exhibited larger size and higher leverage measures. In the absence of a clear regulatory framework, prior to SSAP No. 20, the financial reporting of Translation gains and losses displayed significant variation and inconsistencies. Overall, firms anticipated the issue of SSAP No. 20 and tended to recognise the Translation differences in the balance sheet.

Albert Tsang - One of the best experts on this subject based on the ideXlab platform.

  • The valuation-relevance of the Foreign Translation adjustment: The effect of barriers to entry
    The International Journal of Accounting, 2011
    Co-Authors: Suresh Radhakrishnan, Albert Tsang
    Abstract:

    Abstract We examine the economic effects of barriers to entry on the association between Foreign Currency Translation adjustments and the stock returns of multinational firms operating in the manufacturing and service industries. Firms that are innovation leaders, that is, firms that are research and development (R&D) intensive and firms with high Foreign asset intensity (i.e., asset-intensive firms), are our proxies for firms operating in environments with barriers to entry (i.e., environments in which competition is less intense). We hypothesize and find that Foreign Currency Translation adjustments are positively associated with abnormal stock returns for firms operating in environments with barriers to entry in both manufacturing and service industries. This finding highlights the importance of assessing the valuation-relevance of Foreign Currency Translation adjustments by considering the economic contexts of Foreign Currency movements. Overall, the evidence shows that the accounting rules governing Foreign Currency Translations generally produce results consistent with the economic effects of Foreign exchange rate changes.

  • The Valuation-Relevance of the Foreign Translation Adjustment: The Impact of Barriers to Entry and Rigidity of Wages
    SSRN Electronic Journal, 2006
    Co-Authors: Suresh Radhakrishnan, Albert Tsang
    Abstract:

    We examine the economic effects of barriers to entry and rigidity of wages signaled by the Foreign Currency Translation adjustment on multinational firms' stock returns. Specifically, based on economic theories an appreciation (depreciation) of the Foreign Currency exchange rate could signal (a) an increase (decrease) in the Foreign country's economic growth leading to potentially higher future cash flows for firms operating in environments with barriers to entry: innovation-intensive companies and asset-intensive companies, and (b) a decrease (increase) in future profits for firms operating in environments with rigidity of wages: labor-intensive companies. Firms that are research and development (R&D) leaders in their industry are our proxy for innovation-intensive companies. Among the R&D followers, firms with large total assets (employees) to sales ratio are classified as asset-intensive (labor-intensive) firms. Innovation- and asset-intensive firms are our proxy for firms likely to be affected by the barriers to entry and labor-intensive firms are our proxy for firms likely to be affected by the rigidity of wages. We find that the Foreign Currency Translation adjustment is positively associated with abnormal stock returns for R&D leaders and asset-intensive, R&D followers. We also find that the Foreign Currency Translation adjustment is negatively associated with abnormal stock returns for labor-intensive, R&D followers. This shows the importance of assessing the valuation-relevance of the Foreign Currency Translation adjustment by considering the economic contexts of Foreign Currency fluctuations. Overall, the evidence shows that the accounting rules governing Foreign Currency Translations in general produce results consistent with the economic effects of Foreign exchange rate changes.

Tania Pacecca - One of the best experts on this subject based on the ideXlab platform.

  • an analysis of submissions to the asrb on release 411 Foreign Currency Translation questionnaire
    Accounting and Finance, 1995
    Co-Authors: Tania Pacecca
    Abstract:

    This study examines the accounting method preferences of the managers of firms who made submissions to the ASRB on Release 411 ‘Foreign Currency Translation— Questionnaire’. Content analysis of the actual submissions is used to obtain a measure of the strength of accounting method preferences indicated therein. This aspect of the study combats criticism of previous studies in relation to the oversimplification associated with the dichotomous categorisation of accounting method preferences. The results of the study also provide some support for this criticism of earlier research. Overall, the study provides some evidence that accounting method preferences for Foreign Currency transactions are made in an attempt to maximise the value of the firm.

  • AN ANALYSIS OF SUBMISSIONS TO THE ASRB ON RELEASE 411 ‘Foreign Currency Translation—QUESTIONNAIRE’
    Accounting & Finance, 1995
    Co-Authors: Tania Pacecca
    Abstract:

    This study examines the accounting method preferences of the managers of firms who made submissions to the ASRB on Release 411 ‘Foreign Currency Translation— Questionnaire’. Content analysis of the actual submissions is used to obtain a measure of the strength of accounting method preferences indicated therein. This aspect of the study combats criticism of previous studies in relation to the oversimplification associated with the dichotomous categorisation of accounting method preferences. The results of the study also provide some support for this criticism of earlier research. Overall, the study provides some evidence that accounting method preferences for Foreign Currency transactions are made in an attempt to maximise the value of the firm.

Svetlana Vlady - One of the best experts on this subject based on the ideXlab platform.

  • Translation ACCOUNTING STANDARDS AND THEIR VALUE RELEVANCE: EVIDENCE FROM AUSTRALIAN OIL AND GAS INDUSTRY
    2016
    Co-Authors: Svetlana Vlady, Phd C
    Abstract:

    This paper examines the relationship between the Foreign Currency Translation adjustments and the firm’s market value of the Australia-based oil and gas multinational companies. The Translation accounting under the former standard AASB 1012 “Foreign Currency Translation ” and the current standard AASB 121 “The Effects of Changes in Foreign Exchange Rates ” produces different Translation adjustment results. This study empirically examines this relationship and finds that the Translation adjustments under the former standard AASB 1012 provide information that is opposite to the economic effects of the exchange rate changes. Also, this study uses a case study approach to examine the effect of the new standard AASB 121 on the market value of the oil and gas firms. The case study analysis concludes that the new Translation accounting standard, in conjunction with other new standards, such as, AASB 101 “Presentation of Financial Statements ” and AASB 6 “Exploration for and Evaluation of Mineral Resources”, has the potential to change the relationship between the Translation differences (adjustments) and the firm’s value from an invers

  • The value relevance of the Foreign Currency Translation differences : a study of multinational oil and gas companies in Australia
    The Young Economists Journal, 2008
    Co-Authors: Svetlana Vlady
    Abstract:

    This paper investigates the relationship between Foreign Currency Translation differences and changes in firm’s market equity value of the Australian multinational firms in the oil and gas industry. The paper empirically examines this relationship under the former Australian accounting standard AASB 1012 “Foreign Currency Translation”. The paper thereby supports the new accounting standard AASB 121 “The Effects of Changes in Foreign Exchange Rates” that adopted a functional Currency approach. Since, AASB121 is equivalent to International Financial Reporting Standard IFRS 21 this paper could be useful to understand the effects of Foreign Currency Translation process not only on Australian firms but worldwide

  • Foreign Currency Translation: NEW ACCOUNTING STANDARDS IN AUSTRALIA
    2008
    Co-Authors: Svetlana Vlady, Eva K. Jermakowicz
    Abstract:

    The case examines the effects of the adoption of Australian equivalents to International Financial Reporting Standards related to Foreign Currency Translation on the accounts of two Australian multinational companies operating in the oil and gas industry and one insolvent manufacturing firm. In January 2005 the Australian Accounting Standards Board (AASB) issued accounting standard AASB 121 The Effects of Changes in Foreign Exchange Rates, which was based on the international standard IFRS 21 with the same title. Students explore the accounting effects of AASB 121, compare with U.S. FASB 52, evaluate the adequacy of the Translation adjustment, devise strategies for the company, and consider ethical aspects surrounding earnings management motivations in choosing the functional Currency. The case is designed to give financial accounting and international finance students opportunities to examine the process of translating Foreign Currency based financial statements and to make decisions from the viewpoint of a financial analyst. A detailed TN is available from the authors.

  • Translation Accounting Standards and their Value Relevance: Evidence from Australian Oil and Gas Industry
    2008
    Co-Authors: Svetlana Vlady, Allen Huang
    Abstract:

    This paper examines the relationship between the Foreign Currency Translation adjustments and the firm’s market value of the Australia-based oil and gas multinational companies. The Translation accounting under the former standard AASB 1012 “Foreign Currency Translation” and the current standard AASB 121 “The Effects of Changes in Foreign Exchange Rates” produces different Translation adjustment results. This study empirically examines this relationship and finds that the Translation adjustments under the former standard AASB 1012 provide information that is opposite to the economic effects of the exchange rate changes. Also, this study uses a case study approach to examine the effect of the new standard AASB 121 on the market value of the oil and gas firms. The case study analysis concludes that the new Translation accounting standard, in conjunction with other new standards, such as, AASB 101 “Presentation of Financial Statements” and AASB 6 “Exploration for and Evaluation of Mineral Resources”, has the potential to change the relationship between the Translation differences (adjustments) and the firm’s value from an inverse to a positive relationship and, thus, to improve the quality of the accounting information.