Olga Fullana, Mariano González and David Toscano
In this paper we analyse the effect on unconditional conservatism of the mandatory adoption of International Financial Reporting Standards (IFRS) by the European listed firms in…
Abstract
Purpose
In this paper we analyse the effect on unconditional conservatism of the mandatory adoption of International Financial Reporting Standards (IFRS) by the European listed firms in January 2005. Under the hypothesis that accounting regulation influences the accounting conservatism, we use a non-market-based measure of unconditional conservatism – the accrual-based measure proposed by Givoly and Hayn (2000) – to test this effect, controlling for the other determinants of the unconditional conservatism found in the accounting literature.
Design/methodology/approach
We use a panel data of 10 years and 96 non-financial listed firms in the Spanish stock market in which the differences between local GAAP and IFRS are more important. A pre-estimation analysis of the data reveals that GLS with random effects is the correct estimation procedure. However, to try to deal with the likely endogeneity in the set of variables, the authors perform an estimate with a dynamic estimator for panels with few periods and many individuals where the independent variables are not strictly exogenous.
Findings
As expected, results show evidence that support a significant reduction on the unconditional conservatism of firms in the sample due to the adoption of IFRS. This evidence is relevant to equity market, debt market and corporate governance users of the financial information, and also for the policymakers who can assess the effects of their mandate.
Research limitations/implications
Results shown in this paper have all the limitations of system-, country-, sample- and event-specific studies but, along with many others drawn in alternative contexts, may help to correctly understand both the time-evolution and cross-sectional country differences of firms’ unconditional conservatism.
Originality/value
The study represents the first analysis of the effect of the adoption of IFRS on unconditional conservatism of the European listed companies using a non-market accrual-based measure. Results are not influenced by the dynamics of the stock market and, by comparison, allow us to analyse this influence in results provided by using market-based measures of the unconditional accounting conservatism provided by previous literature.
Details
Keywords
Mariano Gonzalez Sanchez and Sonia Rodriguez-Sanchez
Solvency-II is the current regulatory framework of insurance companies in the European Union. Under this standard, European Insurance and Occupational Pension Authority (EIOPA)…
Abstract
Purpose
Solvency-II is the current regulatory framework of insurance companies in the European Union. Under this standard, European Insurance and Occupational Pension Authority (EIOPA), as a regulatory board, has established that the Smith–Wilson (SW) model can be used as the model to estimate interest rate curve. This paper aims to analyze whether this model adjusts to the market curve better than Nelson–Siegel (NS) and whether the values set for the parameters are adequate.
Design/methodology/approach
This empirical study analyzes whether the SW interest rate curve shows lower root mean squared errors than the NS curve for a sample of daily prices of Spanish Government bonds between 2014 and 2019.
Findings
The results indicate that NS adjusts the market data better, the parameters recommended by the EIOPA correspond to the maximum values observed in the sample period and the current recommended curve for insurance companies underestimates company operations.
Originality/value
This paper verifies that the criterion of the last liquid point does not allow for selecting an optimal sample to adjust the curve and criteria based on prices without arbitrage opportunities are more appropriate.
Details
Keywords
This empirical work studies the influence of investors’ Internet searches on financial markets.
Abstract
Purpose
This empirical work studies the influence of investors’ Internet searches on financial markets.
Design/methodology/approach
In this study, an asset pricing model with six factors is used, and autoregression, heteroscedasticity and moving average are taken into account to extract the independent shocks of each variable. Subsequently, a causality in-mean and in-variance analysis is performed to test the influence of Google searches on financial market variables, specifically, to test whether there is an influence on the idiosyncratic returns of financial assets.
Findings
Unlike most of the literature, the results show that Google searches on the name of listed companies have little influence on the trend and volatility of asset returns. On the contrary, these searches are shown to have a significant influence on trading volumes in the following week.
Practical implications
When analyzing specific effects, such as the influence of Internet searches, on financial markets, it is necessary that the model must include financial properties (asset valuation models) and statistical characteristics (stylized facts); otherwise, the empirical results could be inconsistent, since, among other issues, statistical findings may not be robust given autocorrelation and heteroscedasticity, and if an asset valuation model is not considered, the specific effect analyzed could simply be an indirect effect of a risk factor excluded from the model.
Originality/value
The empirical evidence shows that individual investors using Google have a significant influence on volume only so that institutional investors using other sources of information drive market prices. This means that potential investors should only be interested in the Internet searches index if their interest is focused on trading volume
Details
Keywords
Mariano González-Delgado, Manuel Ferraz-Lorenzo and Cristian Machado-Trujillo
After World War II, an educational modernization process gained ground worldwide. International organizations such as UNESCO began to play a key role in the creation, development…
Abstract
Purpose
After World War II, an educational modernization process gained ground worldwide. International organizations such as UNESCO began to play a key role in the creation, development and dissemination of a new educational vision in different countries. This article examines the origin and development of this modernization process under the dictatorship of Franco. More specifically, we will show how the adoption of this conception in Spain must be understood from the perspective of the interaction between UNESCO and Franco's regime, and how the policies of the dictatorship converged with the proposals suggested by this international organization. Our principal argument is that the educational policies carried out in Spain throughout the second half of the 20th century can be better understood when inserted into a transnational perspective in education.
Design/methodology/approach
This article uses documents from archives that until now were unpublished or scarcely known. We have also analyzed materials published in the preeminent educational journals of the dictatorship, such as the Revista de Educación, Revista Española de Pedagogía, Bordón and Vida escolar, as well as documents published by the Spanish Ministry of National Education.
Findings
Franco's dictatorship built an educational narrative closely aligned with proposals put forward by UNESCO on educational planning after World War II. The educational policies created by the dictatorship were related to the new ideas that strove to link the educational system with economic and social development.
Originality/value
This article is inspired by a transnational history of education perspective. On the one hand, it traces the origins of educational modernization under Franco's regime, which represented a technocratic vision of education that is best understood as a result of the impact that international organizations had in the second half of the 20th century. On the other hand, it follows the intensifying relationship between the dictatorship and the educational ideas launched by UNESCO. Both aspects are little known and studied in Spain.
Details
Keywords
Mariano González, Juan M. Nave and David Toscano
In this paper, the authors aim to analyze the impact of International Financial Reporting Standards' (IFRS) mandatory adoption on the financial statements of Spanish listed…
Abstract
Purpose
In this paper, the authors aim to analyze the impact of International Financial Reporting Standards' (IFRS) mandatory adoption on the financial statements of Spanish listed companies.
Design/methodology/approach
The authors estimate a panel data model by generalized least squares' within-between in order to contrast the possible structural breaks in the relations between income statement items and balance sheet items, using data from the 35 largest listed companies.
Findings
The results show significant changes on these relations, but with different signs and degrees of intensity depending on the balance sheet item analyzed.
Research limitations/implications
The data choice introduces a size bias that could be taken into account in the generalization of the results to other listed companies.
Originality/value
This work is developed using a mandatory, local, accounting and panel data framework for first time using Spanish listed companies in order to measure the impact of the IFRS adoption.
Details
Keywords
Mariano González Sánchez, Ana I. Mateos Ansótegui and Antonio Falcó Montesinos
The purpose of this paper is to locate the specific items from the financial statements that are responsible for the dirty surplus accounting flows and how important they are in…
Abstract
Purpose
The purpose of this paper is to locate the specific items from the financial statements that are responsible for the dirty surplus accounting flows and how important they are in its explanation.
Design/methodology/approach
It is generally accepted that some country accounting rules allow some operations that can generate dirty surplus in the annual statements. Working on this basis, it is necessary to consider information at the same time across firms and across time, using panel data econometric techniques. A static panel data estimated by generalized least squares can be used to correct correlations between firms and account numbers or a dynamic panel data estimated by GMM‐SYS with instrumental variables to avoid endogeneity.
Findings
Results show that in a static panel data model, the income statement items have a lower explicative power of balance sheet items variations, having higher explicative power a dynamic one (AR(1)). Results show that, specifically, financial assets, debts and book value capture the dirty accounting flows.
Research limitations/ implications
Working in differences reduces the explicative power of the income statement and working in levels could be inconsistent if it is impossible to contrast, first, stationary in data due to their shortage. It is suggested that future works increase the frequency of the observed data, and contrast the cointegration as a way to check the accounting relationships.
Practical implications
It is important to evaluate whether the income statement can (or cannot) explain the financial position of a firm. Also it is important to know where dirty surplus accounting flows are located can be useful for firms' valuation.
Originality/value
The econometric technique proposed in the paper deals with the main limitation in accounting research: information is bigger in cross‐section (number of firms) than in time series (economic periods).
Details
Keywords
Daniel Alonso-Martínez, Nuria González-Álvarez and Mariano Nieto
The main goal of this study is to analyze the influence of social capital and corporate ethics on social progress. A theoretical model is proposed, and the hypotheses were tested…
Abstract
The main goal of this study is to analyze the influence of social capital and corporate ethics on social progress. A theoretical model is proposed, and the hypotheses were tested on a sample of 32 Organisation for Economic Cooperation and Development (OECD) and non-OECD countries between 2011 and 2018 that includes data from the Social Progress Imperative non-profit organization as well as from the World Economic Forum database (Global Competitiveness Reports). The results indicate that, although both social capital and corporate ethics have a direct influence on social progress, social capital also influences corporate ethics so that the latter acts as a mediating variable between social capital and social progress.
Details
Keywords
PERU: Castillo faces new corruption probe
Details
DOI: 10.1108/OXAN-ES271636
ISSN: 2633-304X
Keywords
Geographic
Topical
PERU: Censure motion ousts education minister