Title: IFRS adoption and cost of capital: moderating effects of growth opportunities and informational environment
Authors: Hela Turki; Senda Wali; Younes Boujelbene
Addresses: College of Business, Jouf University, Saudi Arabia ' URECA, Faculty of Economics and Management of Sfax, University of Sfax, Tunisia ' URECA, Faculty of Economics and Management of Sfax, University of Sfax, Tunisia
Abstract: The present paper is primarily designed to investigate the relationship binding the IFRS mandatory adoption and the corporate capital cost. Additionally, it is focused on assessing this relationship associated growth opportunities, along with an evaluating of the informational environment moderating role. This study is focused on the French context through implementation of longitudinal data. The study sample involves the entire companies belonging to the CAC All Tradable index, observed over the period ranging between 2002 and 2012. The results appear to reveal that the IFRS mandatory adoption proves to help greatly in reducing the French listed firms' capital cost. Actually, no evidence has been discovered to prevail as the informational environment moderating effect on the relationship binding the IFRS adoption and capital cost. Conversely, some evidence was found of the interaction between the company's growth opportunities and IFRS adoption highlighting cost reduction.
Keywords: IFRS; information asymmetry; cost of capital; informational environment; growth opportunities.
International Journal of Accounting and Finance, 2020 Vol.10 No.2/3, pp.87 - 110
Accepted: 28 Apr 2020
Published online: 06 May 2021 *