Impact of First Time Adoption of IFRS by Nonfinancial Companies Listed on Bucharest Stock Exchange

Author:Univ. Prof. Marian SĂCĂRIN, Ph. D.

JEL:M41

DOI:

Keywords:International Financial Reporting Standards (IFRS), Bucharest Stock Exchange, individual financial statements, return on equity, solvability, indebtedness

Abstract:
Starting with the year 2012, non financial companies whose securities are listed on the Bucharest Stock Exchange have applied International Financial Reporting Standards (IFRS) for the preparation of individual financial statements. Taking into account the considerable challenges generated by such change, this study aims to highlight the quantitative consequences of the first-time adoption of IFRS on assets, equities, liabilities, net income, return on equity, solvency and indebtedness of these companies. On the macroeconomic level, the most affected structures of individual financial statements were equities and net income, with an increase of the former and decrease of the latter. As regards financial indicators analyzed, the return on equity decrease was the most notable effect. With reference to activity sectors, construction companies were the most affected with the largest decrease in net income and return on equity.

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