Artikel

Compliance with IAS 2 in consolidated financial statements of PSE listed companies

As inventories represent a significant balance sheet item for many companies, their correct presentation and disclosure is fundamental for the financial statements' users. This article identifies compliance with the 'IAS 2 Inventories' requirements in consolidated financial statements of selected Czech companies. After determining criteria for the issuer's sample, two research questions were set up for the evaluation of compliance measures with IAS 2. The research focuses on the association between the sum of total assets and the sum of inventories as well as an association between the sum of inventories and their allowances. Investigation is followed by the determination of compliance or non-compliance with the requirements of IAS 2. The research leads to the conclusion that the sum of inventories depends on the sum of assets. However, the sum of inventories' allowances does not depend on the sum of inventories. As far as the area of compliance with the IAS 2 requirements is concerned, on average, issuers did not comply with 3 out of total 8 IAS 2 requirements. The most problematic area of compliance was how reversals of write-downs were disclosed. The second most problematic requirement was a write-down justification and the third most problematic requirement was a disclosure of pledged inventories.

Language
Englisch

Bibliographic citation
Journal: European Financial and Accounting Journal ; ISSN: 1805-4846 ; Volume: 14 ; Year: 2019 ; Issue: 3 ; Pages: 61-78 ; Prague: University of Economics, Faculty of Finance and Accounting

Classification
Management
Accounting
Subject
IAS 2
inventories
allowances
IFRS disclosure

Event
Geistige Schöpfung
(who)
Polachová, Kateřina
Event
Veröffentlichung
(who)
University of Economics, Faculty of Finance and Accounting
(where)
Prague
(when)
2019

DOI
doi:10.18267/j.efaj.230
Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.

Object type

  • Artikel

Associated

  • Polachová, Kateřina
  • University of Economics, Faculty of Finance and Accounting

Time of origin

  • 2019

Other Objects (12)