Compliance with international financial reporting standards (IFRS) and the value relevance of accounting information in emerging stock markets : evidence from Kuwait

Since the 1960s, the value relevance of accounting information has been an important topic in accounting research. The value relevance research provides evidence as to whether accounting numbers relate to corporate value in a predicted manner (Beaver, 2002). Such research is not only important for investors but also provides useful insights into accounting reporting effectiveness for standard setters and other users. Both the quality of accounting standards used and the effectiveness associated with implementing these standards are fundamental prerequisites for high value relevance (Hellstrom, 2006). However, while the literature comprehensively documents the value relevance of accounting information in developed markets, little attention has been given to emerging markets where the quality of accounting standards and their enforcement are questionable. Moreover, there is currently no known research that explores the association between level of compliance with International Financial Reporting Standards (IFRS) and the value relevance of accounting information. Motivated by the lack of research on the value relevance of accounting information in emerging markets and the unique institutional setting in Kuwait, this study has three objectives. First, it investigates the extent of compliance with IFRS with respect to firms listed on the Kuwait Stock Exchange (KSE). Second, it examines the value relevance of accounting information produced by KSE-listed firms over the 1995 to 2006 period. The third objective links the first two and explores the association between the level of compliance with IFRS and the value relevance of accounting information to market participants. Since it is among the first countries to adopt IFRS, Kuwait provides an ideal setting in which to explore these objectives. In addition, the Kuwaiti accounting environment provides an interesting regulatory context in which each KSE-listed firm is required to appoint at least two external auditors from separate auditing firms. Based on the research objectives, five research questions (RQs) are addressed. RQ1 and RQ2 aim to determine the extent to which KSE-listed firms comply with IFRS and factors contributing to variations in compliance levels. These factors include firm attributes (firm age, leverage, size, profitability, liquidity), the number of brand name (Big-4) auditing firms auditing a firm’s financial statements, and industry categorization. RQ3 and RQ4 address the value relevance of IFRS-based financial statements to investors. RQ5 addresses whether the level of compliance with IFRS contributes to the value relevance of accounting information provided to investors. Based on the potential improvement in value relevance from adopting and complying with IFRS, it is predicted that the higher the level of compliance with IFRS, the greater the value relevance of book values and earnings. The research design of the study consists of two parts. First, in accordance with prior disclosure research, the level of compliance with mandatory IFRS is examined using a disclosure index. Second, the value relevance of financial statement information, specifically, earnings and book value, is examined empirically using two valuation models: price and returns models. The combined empirical evidence that results from the application of both models provides comprehensive insights into value relevance of accounting information in an emerging market setting. Consistent with expectations, the results show the average level of compliance with IFRS mandatory disclosures for all KSE-listed firms in 2006 was 72.6 percent; thus, indicating KSE-listed firms generally did not fully comply with all requirements. Significant variations in the extent of compliance are observed among firms and across accounting standards. As predicted, older, highly leveraged, larger, and profitable KSE-listed firms are more likely to comply with IFRS required disclosures. Interestingly, significant differences in the level of compliance are observed across the three possible auditor combinations of two Big-4, two non-Big 4, and mixed audit firm types. The results for the price and returns models provide evidence that earnings and book values are significant factors in the valuation of KSE-listed firms during the 1995 to 2006 period. However, the results show that the value relevance of earnings and book values decreased significantly during that period, suggesting that investors rely less on financial statements, possibly due to the increase in the available non-financial statement sources. Notwithstanding this decline, a significant association is observed between the level of compliance with IFRS and the value relevance of earnings and book value to KSE investors. The findings make several important contributions. First, they raise concerns about the effectiveness of the regulatory body that oversees compliance with IFRS in Kuwait. Second, they challenge the effectiveness of the two-auditor requirement in promoting compliance with regulations as well as the associated cost-benefit of this requirement for firms. Third, they provide the first known empirical evidence linking the level of IFRS compliance with the value relevance of financial statement information. Finally, the findings are relevant for standard setters and for their current review of KSE regulations. In particular, they highlight the importance of establishing and maintaining adequate monitoring and enforcement mechanisms to ensure compliance with accounting standards. In addition, the finding that stricter compliance with IFRS improves the value relevance of accounting information highlights the importance of full compliance with IFRS and not just mere adoption.

Visual arts, technology and education : how can teaching and learning in high school visual arts classrooms be enriched by the use of computer technology?

Whilst a variety of studies has appeared over the last decade addressing the gap between the potential promised by computers and the reality experienced in the classroom by teachers and students, few have specifically addressed the situation as it pertains to the visual arts classroom. The aim of this study was to explore the reality of the classroom use of computers for three visual arts highschool teachers and determine how computer technology might enrich visual arts teaching and learning. An action research approach was employed to enable the researcher to understand the situation from the teachers' points of view while contributing to their professional practice. The wider social context surrounding this study is characterised by an increase in visual communications brought about by rapid advances in computer technology. The powerful combination of visual imagery and computer technology is illustrated by continuing developments in the print, film and television industries. In particular, the recent growth of interactive multimedia epitomises this combination and is significant to this study as it represents a new form of publishing of great interest to educators and artists alike. In this social context, visual arts education has a significant role to play. By cultivating a critical awareness of the implications of technology use and promoting a creative approach to the application of computer technology within the visual arts, visual arts education is in a position to provide an essential service to students who will leave high school to participate in a visual information age as both consumers and producers.

Reducing high levels of communication apprehension among primary school students

This study focused on a group of primary school teachers as they implemented a variety of intervention actions within their class programs aimed towards supporting the reduction of high levels of communication apprehension (CA) among students.Six teachers and nine students, located across three primary schools, four year levels,and six classes, participated in this study. For reasons of confidentiality the schools,principals, parents, teachers, teacher assistants, and students who were involved in this study were given fictitious names. The following research question was explored in this study: What intervention actions can primary school teachers implement within their class programs that support the reduction of high CA levels among students? Throughout this study the term CA referred to "an individual's level of fear or anxiety associated with either real or anticipated (oral) communication with another person or persons" (McCroskey, 1984, p. 13). The sources of CA were explained with reference to McCroskey's state-trait continuum. The distinctions between high and appropriate levels of CA were determined conceptually and empirically. The education system within which this study was conducted promoted the philosophy of inclusion and the practices of inclusive schooling. Teachers employed in this system were encouraged to create class programs inclusive of and successful for all students. Consequently the conceptual framework within which this study was conducted was based around the notion of inclusion. Action research and case study research were the methodologies used in the study. Case studies described teachers' action research as they responded to the challenge of executing intervention actions within their class programs directed towards supporting the reduction of high CA levels among students. Consequently the teachers and not the researcher were the central characters in each of the case studies. Three principal data collection instruments were used in this study: Personal Report of Communication Fear (PRCF) scale, semistructured interviews, and dialogue journals. The PRCF scale was the screening tool used to identify a pool of students eligible for the study. Data relevant to the students involved in the study were gathered during semistructured interviews and throughout the dialogue journaling process. Dialogue journaling provided the opportunity for regular contact between teachers and the researcher, a sequence to teacher and student intervention behaviours, and a permanent record of teacher and student growth and development. The majority of teachers involved in this study endeavoured to develop class programs inclusive of all students.These teachers acknowledged the importance of modifying aspects of their class programs in response to the diverse and often multiple needs of individual students with high levels of CA. Numerous conclusions were drawn regarding practical ways that the teachers in this study supported the reduction of high CA levels among students. What this study has shown is that teachers can incorporate intervention actions within their class programs aimed towards supporting students lower their high levels of CA. Whilst no teacher developed an identical approach to intervention, similarities and differences were evident among teachers regarding their selection, interpretation, and implementation of intervention actions. Actions that teachers enacted within their class programs emerged from numerous fields of research including CA, inclusion, social skills, behaviour teaching, co-operative learning, and quality schools. Each teacher's knowledge of and familiarity with these research fields influenced their preference for and commitment to particular intervention actions. Additional factors including each teacher's paradigm of inclusion and exclusion contributed towards their choice of intervention actions. Possible implications of these conclusions were noted with reference to teachers,school administrators, support personnel, system personnel, teacher educators, parents, and researchers.