Fair value hierarchy measures: Post-implementation evidence on IFRS 7
Using a balance sheet valuation model, this study examines if information on the fair value hierarchy of on-balance sheet financial assets and financial liabilities are incorporated in the market’s valuation of companies’ equities in Singapore. The results of the study show significant associations...
Saved in:
Main Author: | |
---|---|
Format: | text |
Language: | English |
Published: |
Institutional Knowledge at Singapore Management University
2015
|
Subjects: | |
Online Access: | https://ink.library.smu.edu.sg/soa_research/1457 https://ink.library.smu.edu.sg/context/soa_research/article/2456/viewcontent/FairValueHierarchyMeasures_2015_GSTFJBR.pdf |
Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
Institution: | Singapore Management University |
Language: | English |
id |
sg-smu-ink.soa_research-2456 |
---|---|
record_format |
dspace |
spelling |
sg-smu-ink.soa_research-24562023-10-11T07:15:12Z Fair value hierarchy measures: Post-implementation evidence on IFRS 7 TAN, Pearl Using a balance sheet valuation model, this study examines if information on the fair value hierarchy of on-balance sheet financial assets and financial liabilities are incorporated in the market’s valuation of companies’ equities in Singapore. The results of the study show significant associations between as-reported Level 1 and Level 2 fair value measures of financial assets and market values. However, the results are not significant for Level 3 fair value measures of financial assets and each of the three levels of fair value measures of financial liabilities. The results also show that returns are more positively associated with as-reported gains and losses from Level 1 and Level 2 fair value measures than those from Level 3 fair value measures. Overall, the evidence suggests that information on the fair value hierarchy of IFRS 7 Financial Instruments: Disclosures are used by market participants in their pricing decisions. The market however appears to place greater weights on fair value changes taken to the income statement than those taken to OCI, notwithstanding the level of the fair value measure. While the fixation with income statement measures remains a puzzle, the results are consistent with prior studies that show that investors largely ignore OCI in their pricing of shares. 2015-07-01T07:00:00Z text application/pdf https://ink.library.smu.edu.sg/soa_research/1457 info:doi/10.7603/s40706-015-0013-6 https://ink.library.smu.edu.sg/context/soa_research/article/2456/viewcontent/FairValueHierarchyMeasures_2015_GSTFJBR.pdf http://creativecommons.org/licenses/by/4.0/ Research Collection School Of Accountancy eng Institutional Knowledge at Singapore Management University Fair Value Hierarchy IFRS Disclosure OCI Accounting Asian Studies Corporate Finance |
institution |
Singapore Management University |
building |
SMU Libraries |
continent |
Asia |
country |
Singapore Singapore |
content_provider |
SMU Libraries |
collection |
InK@SMU |
language |
English |
topic |
Fair Value Hierarchy IFRS Disclosure OCI Accounting Asian Studies Corporate Finance |
spellingShingle |
Fair Value Hierarchy IFRS Disclosure OCI Accounting Asian Studies Corporate Finance TAN, Pearl Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
description |
Using a balance sheet valuation model, this study examines if information on the fair value hierarchy of on-balance sheet financial assets and financial liabilities are incorporated in the market’s valuation of companies’ equities in Singapore. The results of the study show significant associations between as-reported Level 1 and Level 2 fair value measures of financial assets and market values. However, the results are not significant for Level 3 fair value measures of financial assets and each of the three levels of fair value measures of financial liabilities. The results also show that returns are more positively associated with as-reported gains and losses from Level 1 and Level 2 fair value measures than those from Level 3 fair value measures. Overall, the evidence suggests that information on the fair value hierarchy of IFRS 7 Financial Instruments: Disclosures are used by market participants in their pricing decisions. The market however appears to place greater weights on fair value changes taken to the income statement than those taken to OCI, notwithstanding the level of the fair value measure. While the fixation with income statement measures remains a puzzle, the results are consistent with prior studies that show that investors largely ignore OCI in their pricing of shares. |
format |
text |
author |
TAN, Pearl |
author_facet |
TAN, Pearl |
author_sort |
TAN, Pearl |
title |
Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
title_short |
Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
title_full |
Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
title_fullStr |
Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
title_full_unstemmed |
Fair value hierarchy measures: Post-implementation evidence on IFRS 7 |
title_sort |
fair value hierarchy measures: post-implementation evidence on ifrs 7 |
publisher |
Institutional Knowledge at Singapore Management University |
publishDate |
2015 |
url |
https://ink.library.smu.edu.sg/soa_research/1457 https://ink.library.smu.edu.sg/context/soa_research/article/2456/viewcontent/FairValueHierarchyMeasures_2015_GSTFJBR.pdf |
_version_ |
1781793941167800320 |