AbstractsBusiness Management & Administration

The purpose of this study is to examine whether the introduction of International Financial Reporting Standard No: 8 (IFRS 8) - "Operating Segments" has had a significant effect in improving the financial analysts’ forecasting abilities of earnings per share in New Zealand (NZ), Australia, Hong Kong (HK) and China. The extent of compliance with the standard was checked using a disclosure index based on segment reporting requirements of IFRS 8 while the forecasting errors were inferred by comparing forecasts of EPS with actuals. This paper specifically investigates whether the financial forecasts accuracy during the post-implementation period of IFRS8 had improved compared to pre-implementation of IFRS 8. The financial analysts’ forecast errors were also compared between code law country (China) and common law countries (NZ, Australia and HK) after the implementation of IFRS 8. Using a sample of 190 companies, including 26 NZ companies, 63 Australian companies, 70 HK companies and 31 Chinese companies, analysed by repeated measures ANOVA and the paired-sample t-test, the results indicate that the disclosure level of segment reporting of companies in NZ, Australia, HK and China increased after the implementation of IFRS 8, however, the analysts forecasts errors of post implementation periods were not statistically significantly different to those of pre implementation of IFRS 8. The results also show that the disclosure level of China (code law country) is significant lower when countries are pooled together (NZ, Australia and HK, i.e. common law countries) and compared with HK separately after the implementation of the IFRS 8. However, the financial analysts’ forecast errors of Chinese companies were not significantly higher than them during the same period. The results of this paper suggest that the standard has not been perceived as beneficial by the financial analysts’ for forecasting. Although a number of papers have attempted to review the success of the implementation of IFRS 8 in Europe, this dissertation serves to address a gap by statistically testing the financial forecasts errors of earnings per share of companies from New Zealand (NZ), Australia, Hong Kong (HK) and China of which there is little known.