Title: Effect on the comparability of accounting choices of Brazilian companies in property, plant and equipment recognition

Authors: Sirlei Lemes; Patrícia De Souza Costa; Vinícius Aversari Martins

Addresses: Accounting School, Universidade Federal de Uberlândia, João Naves de Avila, 2121 Campus Santa Monica, Bloco F, 38.408-100 Uberlândia, MG, Brazil ' Accounting School, Universidade Federal de Uberlândia, João Naves de Avila, 2121 Campus Santa Monica, Bloco F, 38.408-100 Uberlândia, MG, Brazil ' FEA-RP, Universidade de São Paulo, Av. dos Bandeirantes, 3.900 Sala 13, Bloco C, 14040-900 Ribeirão Preto, SP, Brazil

Abstract: The goal of this research was to identify the level of comparability of accounting reports of Brazilian companies in the recognition of property, plant and equipment (PPE) before (2007), during (2008-2009) and after the convergence to IFRS (2010-2012). The sample was composed of 63 companies that were part of the IBOVESPA index of BM&FBOVESPA, except for the year 2007, in which it had only 60 companies in the sample. The data were treated with the Herfindahl index (H), which allows us to quantify the level of comparability of accounting practices between companies of the same country. The results show a low to moderate index of comparability between the choices of companies on initial and subsequent PPE recognition. The lower flexibility of accounting choices made during the years preceding the first adoption of IFRS in Brazil can justify the higher level of comparability that we found in this period.

Keywords: comparability; accounting choices; IFRS; International Financial Reporting Standards; property plant equipment; PPE recognition; convergence; Brazil; Herfindahl index; first adoption.

DOI: 10.1504/IJEA.2015.074568

International Journal of Economics and Accounting, 2015 Vol.6 No.4, pp.301 - 325

Received: 08 May 2021
Accepted: 12 May 2021

Published online: 05 Feb 2016 *

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