'Who Has Benefited the Most From the Adoption of Ifrs in France?' - Qui a le plus profité de l’adoption des IFRS en France?

Revue Française de Gestion, 41/249 : 145-158, 2015

Posted: 6 Feb 2020

See all articles by Fatima Baalbaki Shibly

Fatima Baalbaki Shibly

The American University of Kuwait - College of Business & Economics

Pascal Dumontier

University of Grenoble; University of Angers - Centre de Recherches Appliquées à la Gestion (CERAG)

Date Written: 2015

Abstract

Several studies show that mandatory IFRS adoption resulted in positive capital market impacts for both investors (higher stock liquidity and lower information asymmetry) and firms (lower cost of equity capital). However, the observed impacts are only mean impacts since the characteristics of IFRS adopters are generally ignored. This study aims to fill that gap. Focusing on information asymmetry, we find that French firms did not benefit identically from IFRS adoption. The adoption of the new accounting standards resulted in lower information asymmetry for firms with high analyst following, high voluntary disclosures, and highly specific assets and activities. In contrast, IFRS adoption resulted in higher information asymmetry for firms with low analyst following and low voluntary disclosures. It had no impact on firms with non-specific assets. Surprisingly, we also show that IFRS adoption worsened information asymmetry for firms that suffered from high information asymmetry prior to the adoption of IFRS. Conversely, and paradoxically, firms that had the least to expect from IFRS, because of weak asymmetry prior to the adoption, benefitted the most from the adoption.

Keywords: IFRS Adoption, France, Information Asymmetry

Suggested Citation

Baalbaki Shibly, Fatima and Dumontier, Pascal, 'Who Has Benefited the Most From the Adoption of Ifrs in France?' - Qui a le plus profité de l’adoption des IFRS en France? (2015). Revue Française de Gestion, 41/249 : 145-158, 2015. Available at SSRN: https://ssrn.com/abstract=3519103

Fatima Baalbaki Shibly (Contact Author)

The American University of Kuwait - College of Business & Economics ( email )

Safat
Salmiya, 13034
Kuwait

Pascal Dumontier

University of Grenoble ( email )

Grenoble
France

University of Angers - Centre de Recherches Appliquées à la Gestion (CERAG)

150 rue de la Chimie, BP47
Grenoble Cedex 9, 38040
France

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