Special Issue "Financial Reporting, Accounting and Financial Statement Analysis"

A special issue of Journal of Risk and Financial Management (ISSN 1911-8074).

Deadline for manuscript submissions: 31 July 2023 | Viewed by 5291

Special Issue Editors

Department of Management, ISEG-Lisbon School of Economics & Management, Universidade de Lisboa, 1200-781 Lisboa, Portugal
Interests: financial and non-financial reporting; accounting information quality; earnings management
Department of Management, ISEG-Lisbon School of Economics & Management, Universidade de Lisboa, 1200-781 Lisboa, Portugal
Interests: financial statement analysis; financial and non-financial reporting and analysis; corporate finance

Special Issue Information

Dear Colleagues,

This Special Issue focuses on areas of financial reporting, accounting and financial statement analysis. Financial statements are the basis for many business analyses, and accounting is the primary source of information in the analysis of financial statements. The quality of financial accounting and reporting is, therefore, crucial for a better allocation of resources and value creation.

This Special Issue invites researchers in the area of financial reporting and financial statement analysis, as well as related areas (e.g., sustainability and ESG reporting and analysis), to provide significant empirical and theoretical insights on the topic. Accordingly, this Special Issue aims to stimulate the debate about the status quo and future direction of financial reporting and financial statements analysis.

Theoretical and empirical articles on the application of financial reporting and financial statement analysis are welcome as submissions. Diverse types of methodological approaches, including empirical or qualitative research, literature reviews or meta-analyses are also welcome.

Prof. Dr. Cristina Gaio
Prof. Dr. Tiago Gonçalves
Guest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Journal of Risk and Financial Management is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • financial reporting
  • financial analysis
  • earnings quality
  • disclosure quality
  • accounting principles and standards
  • compliance and GAAP
  • financial modelling and financial planning and analysis (FP&A)
  • value-added analysis
  • performance measuring
  • valuation
  • credit risk
  • mergers and acquisitions (M&A)
  • auditing
  • financial management
  • corporate governance
  • sustainability reporting and analysis

Published Papers (4 papers)

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Research

Article
Investment Efficiency and Earnings Quality: European Evidence
J. Risk Financial Manag. 2023, 16(4), 224; https://doi.org/10.3390/jrfm16040224 - 03 Apr 2023
Viewed by 607
Abstract
This study aims to analyze the relationship between earnings quality and investment efficiency in the European context, in order to understand whether higher earnings quality mitigates investment inefficiencies. To further understand the relationship between earnings quality and investment efficiency, the roles of cash [...] Read more.
This study aims to analyze the relationship between earnings quality and investment efficiency in the European context, in order to understand whether higher earnings quality mitigates investment inefficiencies. To further understand the relationship between earnings quality and investment efficiency, the roles of cash and financial constraints are also analyzed. We use firm-year data based on unbalanced panel data, and control for country, year, and industry fixed effects using a sample composed of listed and unlisted European companies from 19 countries and 17 industries for the period 2010–2018. The results show a positive and significant relationship between earnings quality and investment efficiency. In both scenarios of investment inefficiency, overinvestment and underinvestment, the results suggest that a higher quality of reported earnings mitigates investment inefficiencies. The results also suggest that the negative relationship holds for cash-constrained and unconstrained firms, and that in firms that are financially unconstrained (higher levels of cash and lower levels of leverage) the combined effect with earnings quality is associated with a lower investment efficiency. Full article
(This article belongs to the Special Issue Financial Reporting, Accounting and Financial Statement Analysis)
Article
Can Corporate Sustainability Drive Economic Value Added? Evidence from Larger European Firms
J. Risk Financial Manag. 2023, 16(4), 215; https://doi.org/10.3390/jrfm16040215 - 29 Mar 2023
Viewed by 866
Abstract
This study analyses the association between firms’ sustainability and economic performance in Europe, considering the channels of margin and turnover. The sample is composed of firms listed in the STOXX Europe 600 Index from 2012 to 2020. The sustainability performance is captured by [...] Read more.
This study analyses the association between firms’ sustainability and economic performance in Europe, considering the channels of margin and turnover. The sample is composed of firms listed in the STOXX Europe 600 Index from 2012 to 2020. The sustainability performance is captured by the combined and individual ESG scores from Refinitiv, and dynamically tested with proxies of economic performance, including economic value added, return on firms’ assets and its components, margin and turnover. The methodological approach comprises different panel data specifications and tackles the potentially unobserved, time-invariant heterogeneity, endogeneity concerns, and reverse causality biases. Our findings point to a strong positive association between firms’ sustainability and economic performance in Europe, although the individual ESG forces are not at play with the same intensity. The environmental pillar is the one that is systematically associated with better economic performance across all estimations. The influence of sustainability performance on economic performance is also channeled by both profit margin and turnover. We find that a 1% improvement in the ESG score yields an increase in the economic value added of 0.08%, EVA over revenues. In general, our findings point to a shift from the conventional business model perspective to the incorporation of a core sustainability proposition and agenda that brings advantages and drives economic performance. Full article
(This article belongs to the Special Issue Financial Reporting, Accounting and Financial Statement Analysis)
Article
Compositional Classification of Financial Statement Profiles: The Weighted Case
J. Risk Financial Manag. 2022, 15(12), 546; https://doi.org/10.3390/jrfm15120546 - 22 Nov 2022
Cited by 2 | Viewed by 711
Abstract
This article classifies petrol retail companies in Spain based on their financial ratios using the compositional data analysis (CoDA) methodology. This methodology solves the most common distributional problems encountered in the statistical analysis of financial ratios. The main purpose of this article is [...] Read more.
This article classifies petrol retail companies in Spain based on their financial ratios using the compositional data analysis (CoDA) methodology. This methodology solves the most common distributional problems encountered in the statistical analysis of financial ratios. The main purpose of this article is to show that with the CoDA methodology, accounting figures presenting low values can have a disproportional influence on classification. This problem can be attenuated by applying weighted CoDA, which is a novelty in the financial statement analysis field. The suggested weight of each accounting figure is proportional to its arithmetic mean. The results of Ward clustering show that after weighting, the contributions of the accounting figures to the total variance and to the clustering solution are more balanced, and the clusters are more interpretable. Four distinct financial profiles are identified and related to non-financial variables. Only one of the profiles represents companies in financial distress, with low turnover, low return on assets, high indebtedness, and low liquidity. Further developments include alternative weighting schemes. Full article
(This article belongs to the Special Issue Financial Reporting, Accounting and Financial Statement Analysis)
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Article
Earnings Management and Corporate Performance in the Scope of Firm-Specific Features
J. Risk Financial Manag. 2022, 15(10), 426; https://doi.org/10.3390/jrfm15100426 - 23 Sep 2022
Cited by 6 | Viewed by 2459
Abstract
Various models have been created all around the world to identify enterprises that manipulate their earnings. These earnings management techniques aid businesses in enhancing their financial performance or gaining some competitive advantages. The primary goal of this article was to identify the firm-specific [...] Read more.
Various models have been created all around the world to identify enterprises that manipulate their earnings. These earnings management techniques aid businesses in enhancing their financial performance or gaining some competitive advantages. The primary goal of this article was to identify the firm-specific characteristics that affect how businesses manage their earnings using a sample of 15,716 businesses from various economic sectors in the Slovak environment during a 3 year period. The level of earnings management was measured by discretionary accruals using the Kasznik model. In this paper, a correspondence analysis using the chi-square distance measure was applied to find the dependence between the earnings management practices and firm-specific features (firm size, legal form, and sectoral classification). The results of the study indicate that aggressive (income-increasing) earnings management practices are typical of small enterprises with a public limited ownership structure, mostly in sectors R and M (using the NACE sectoral classification). Conservative (income decreasing) practices can be observed in enterprises in the sectors J or F, and they are also used by medium-sized enterprises and those with private limited ownership structure. The results revealed that large enterprises do not tend to manipulate their earnings, as well as enterprises operating in sector K. The insights of this study may provide important and useful information for shareholders and regulators in evaluating determinants that are effective in mitigating earnings management practices. Authorities, regulators, analysts, and auditors may find the importance of the discovered variances helpful in identifying various strategies and techniques for earnings manipulation that may differ among industries according to their typical characteristics. Full article
(This article belongs to the Special Issue Financial Reporting, Accounting and Financial Statement Analysis)
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