Impact of International Financial Reporting Standards on the equity of financial institutions in Argentina at the transition date
DOI:
https://doi.org/10.5281/zenodo.14501903Keywords:
Banking Entities, International Financial Reporting Standards, Transition DateAbstract
The transition to International Financial Reporting Standards - IFRS - is a significant step for all listed companies in Argentina and especially for financial institutions. This is so because this sector of the economy has a more complex regulatory framework than the rest of the companies, generating a greater distance between local regulations and international standards. For this reason, banking institutions were the last to join the mandatory adoption of international standards.
The purpose of this study is to examine the effect of IFRS adoption on the equity of financial institutions in Argentina at the transition date. In order to carry out this analysis, the Comparability Index -IC- developed by Gray (1980) is used, which allows comparing the net worth calculated according to local accounting standards with the net worth based on IFRS at the same date.
This analysis reveals the effect on banks' equity due to the adoption of IFRS at the transition date, providing valuable information for interested parties, investors and regulators, when assessing the comparability of financial information in this transition process.
The results obtained show that the net equity of Argentine companies measured in accordance with IFRS shows an average increase of 11.03% with respect to the net equity measured in accordance with local standards at the transition date.
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