Financial Statement Impact of IFRS Adoption: The Case of Korea and Implication for IFRS Adoption in the U.S.

February 9, 2014 Leave a comment

Financial Statement Impact of IFRS Adoption: The Case of Korea and Implication for IFRS Adoption in the U.S.

Yoon Ho Kim 

Samsung Life Insurance

Jaywon Lee 

Korea Advanced Institute of Science and Technology (KAIST)

Sang Hyun Park 

Georgia Regents University
October 1, 2013
KAIST College of Business Working Paper Series No. 2013-033 

Abstract:      
This study investigates the financial statement impact of adopting International Financial Reporting Standards (IFRS) using a unique set of manually collected sample of Korean firms who have early-adopted IFRS. We collect approximately 90 reconciliation items and document their respective influence on asset, liability, equity and net income. Applying IFRS, asset, liability, equity and net income values all decrease. In terms of value relevance, IFRS equity values are not more value relevant than Korean GAAP (K-GAAP) values while IFRS net income values are less value relevant than K-GAAP values. In regards to earnings management, we are unable to find any significant differences between IFRS and K-GAAP. Considering that K-GAAP resembles the U.S. GAAP in many aspects, we offer some implications for IFRS adoption in the U.S.

Filed under Investing Process

Chief Financial Officer Power, Pay Duration, and Earnings Quality

February 9, 2014 Leave a comment

Chief Financial Officer Power, Pay Duration, and Earnings Quality

Stacey Kaden 

University of Arkansas

Juan Manuel Sanchez 

Texas Tech University
August 16, 2013
AAA 2014 Management Accounting Section (MAS) Meeting Paper

Abstract: 
While numerous studies have examined the impact that powerful CEOs have on their compensation and overall firm decisions, relatively little is known about how powerful CFOs influence their compensation and important firm outcomes, such as earnings quality. This is somewhat surprising given the critical role CFOs play in the financial reporting process of a firm. We examine whether relatively more powerful CFOs influence the “duration” of their compensation. Our results suggest that powerful CFOs have shorter pay durations than less powerful CFOs, giving powerful CFOs faster unrestricted access to their compensation. Additionally, we examine whether powerful CFOs affect the earnings quality of the firms they manage, particularly when the incentives arising from “pay duration” are strong. We find higher levels of income-increasing accrual-based earnings management in firms with powerful CFOs who have short pay durations.

 

Filed under Investing Process

To be exceptional, you have to go against the grain. You have to be a rule-breaker. An individual. But merely separating oneself from the pack isn’t enough. One has to approach adveristy as “hidden opportunities for achievement”

February 9, 2014 Leave a comment

Being Exceptional Is Easier Than You Think

By John Maxfield | More Articles | Save For Later
January 31, 2014 | Comments (5)

image001-2

Think about somebody in your life, or perhaps a historical figure, that you consider to be an exceptional human being.

Say, for example, Abraham Lincoln, Nelson Mandela, or Hellen Keller.

What is it about people like this that makes them exceptional? Is it a unique combination of qualities like honesty, kindness, and generosity? Or is it a distinct and separate trait altogether, such that one could even be exceptional yet dishonest and unkind? Read more of this post

Filed under Life

Warren Buffett: The Three Things I Look For in a Person

February 9, 2014 Leave a comment

Warren Buffett: The Three Things I Look For in a Person

By Shane Parrish | More Articles | Save For Later
February 2, 2014 | Comments (18)

Students often go to visit Warren Buffett. And when they do, he often plays a little game with them.

He asks each student to pick a classmate. Not just any classmate, but the classmate you would choose if you could have 10% of their earnings for the rest of their life. Which classmate would you pick and why? Read more of this post

Filed under Life

What Microsoft can learn from Sony

February 9, 2014 Leave a comment

What Microsoft can learn from Sony

By Hayley Tsukayama, E-mail the writer

Sony chief executive Kazuo Hirai has made a painful decision, announcing Thursday that Sony is parting ways with its Vaio line of computers, one of the most iconic brands in the company’s modern portfolio. Read more of this post

Filed under TMT Trends

Multibillion-dollar stock hedge funds, Joho Capital and Scout Capital, told their investors they were closing. Scout managed $6.7 billion and Joho about $5 billion

February 9, 2014 Leave a comment

Hedge-Fund Firm Exis Capital to Shut Down

Exis Managed Just $75 Million at the End of 2013

JULIET CHUNG

Updated Feb. 3, 2014 6:06 p.m. ET

New York hedge-fund firm Exis Capital Management Inc., run by prominent art collector Adam Sender, is shutting down following poor performance last year, according to people with knowledge of the matter. Read more of this post

Filed under Macro Trends

Klarman Held 50 Percent Cash Amid Scarce Value

February 9, 2014 Leave a comment

Klarman Held 50 Percent Cash Amid Scarce Value

by Michael IdeJanuary 27, 2014, 12:20 pm

Investment funds are usually looking for cash, so it was something of a surprise (although not to ValueWalk readers) when Baupost Group LLC founder Seth Klarman announced that he was giving money back to his investors for the second time in just a few years. The problem is that, as a dedicated value investor, Klarman found himself holding onto cash and increasing exposure to gold because not much else looked attractive, according to several people who attended a recent speech given by Klarman. Read more of this post

Filed under Macro Trends

New measures proposed to strengthen Singapore stock market

February 9, 2014 Leave a comment

New measures proposed to strengthen Singapore stock market

Friday, February 7, 2014 – 19:18

Alvin Foo

The Straits Times

SINGAPORE – A slew of changes is being proposed by the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX) to strengthen the local stock market, in the wake of last October’s penny stock crash. Read more of this post

Filed under Macro Trends

Michael Mauboussin – What Does a PE Multiple Mean? PE Multiples Are Not Valuation, They Are Shorthand: Mauboussin

February 9, 2014 Leave a comment

Michael Mauboussin – What Does a PE Multiple Mean?

by VW StaffFebruary 07, 2014, 12:07 pm

Michael Mauboussin is considered an expert in the field of behavioral finance and has some famous books on the topic including, Think Twice: Harnessing the Power of Counterintuition and More More Than You Know: Finding Financial Wisdom in Unconventional Places. Read more of this post

Filed under Macro Trends

Amazon tests Brazil’s retail jungle with its Kindle

February 9, 2014 Leave a comment

Amazon tests Brazil’s retail jungle with its Kindle

8:36am EST

By Esteban Israel and Marcela Ayres

SAO PAULO (Reuters) – Amazon Inc. started selling its Kindle online in Brazil on Friday, expanding from ebooks into retail for the first time in Latin America’s biggest and most challenging ecommerce market. Read more of this post

Filed under TMT Trends

Taiwan’s MediaTek sets up backyard brawl with Qualcomm

February 9, 2014 Leave a comment

Taiwan’s MediaTek sets up backyard brawl with Qualcomm

3:08pm EST

By Noel Randewich

SAN FRANCISCO (Reuters) – Qualcomm Inc, the world leader in smartphone microchips, may want to shore up its defensive tactics.

Taiwan’s MediaTek Inc, the leading chip supplier for Chinese smartphones, is barreling into the U.S. market with a new major global branding campaign and setting up shop in San Diego, California, home to Qualcomm. Read more of this post

Filed under TMT Trends

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