مقاله انگلیسی رایگان در مورد انقلاب حسابداری دارایی نامشهود – وایلی 2018

This study examines the impact of changes in accounting standards on the accounting for goodwill and identifiable intangible assets (IIA) by Australian companies. Australia adopted International Financial Reporting Standards (IFRS) from 2005. Prior to 2005, under Australian domestic accounting standards (AGAAP)1 , purchased goodwill had to be capitalized and amortized using the straight-line method over a period not exceeding 20 years, while IIA were largely unregulated. Under IFRS, all purchased intangibles must be capitalized as assets, but most internally developed IIA must not be. Subsequently, goodwill and IIA with indefinite useful life are subject to annual impairment testing, and finite life IIA are amortized and tested annually for impairment. While the transition to IFRS in 2005 required managers to derecognize some capitalized internally developed IIA, they were also required to separately recognize IIA previously included in purchased goodwill. Reinstatement of goodwill and purchased IIA previously written off was also permitted. We examine how this transition changed the way Australian companies account for their goodwill and IIA. Both AGAAP and IFRS standards on goodwill and IIA contained scope for management discretion in measurement and classification. By their nature, intangible assets create discretion due to the often-unverifiable nature of estimates needed in their valuation (Ramanna & Watts, 2012). Consistent with positive accounting theory (Watts & Zimmerman, 1986), we assume that managers value that discretion, because it allows them to opportunistically manage earnings and balance sheet numbers to meet earnings, compensation, and debt-covenant compliance targets. The way in which managers can exercise this discretion changed when Australia adopted IFRS. Under AGAAP, there was relatively little discretion in accounting for goodwill subsequent to its recognition, due to the systematic amortization regime required. On the one hand, there was much discretion in accounting for IIA, given the comparatively small amount of regulation of IIA in AGAAP. Under IFRS, there is now more discretion in accounting for goodwill stemming from IFRS’ “impairment-only” approach, due to the unverifiable nature of valuations in the impairment test (Hamberg & Beisland, 2014; Ramanna & Watts, 2012). On the other hand, IFRS prescribes specific accounting methods to measure IIA subsequent to initial recognition: impairment for indefinite life IIA and a dual approach including amortization plus impairment for finite IIA. Compared to the previous rather unregulated Australian environment for IIA, these amortization and impairment rules are perceived as more stringent. However, companies still have some discretion in deciding whether an IIA has a finite life or an indefinite life. We therefore propose that under IFRS, there will be a tendency for Australian companies to recognize greater portions of indefinite life IIA relative to finite life IIA on their balance sheets. This is in line with the argument that managers are likely to exploit the discretion afforded by the impairment-only approach applicable to indefinite life IIA rather than the systematic amortization required for finite IIA (Hamberg & Beisland, 2014; Li & Sloan, 2017). Based on the same argument, we propose that companies are more likely to report lower expenses related to goodwill under IFRS compared to AGAAP. To the extent that managers can also use their discretion for signaling purposes, we finally propose that while a mechanical amortization (goodwill amortization under AGAAP and IIA amortization under IFRS) is not relevant for market valuation, the market perceives discretionary charges as value relevant (impairments under AGAAP and IFRS as well as IIA amortization under AGAAP).