Volume 5, Issue 1, March 2020, Page: 52-61
Financial Instruments’ Disclosure in Compliance with IFRS 7: The Portuguese Companies
Francisco Leote, Department of Accounting and Finance, Business School of Polytechnic Institute of Setúbal, Setúbal, Portugal
Clarisse Pereira, Department of Accounting and Finance, Business School of Polytechnic Institute of Setúbal, Setúbal, Portugal
Rui Brites, Department of Management, Business School of Polytechnic Institute of Setúbal, Setúbal, Portugal
Teresa Godinho, Department of Accounting and Finance, Business School of Polytechnic Institute of Setúbal, Setúbal, Portugal
Received: Dec. 30, 2019;       Accepted: Jan. 6, 2020;       Published: Mar. 10, 2020
DOI: 10.11648/j.ijafrm.20200501.15      View  154      Downloads  71
Abstract
The constant changes in the business context and international relations have led companies to be provided with financial reporting with useful information, including their relevance, comparability and harmonization as required by International Financial Reporting Standards (IFRS). This study analyzes the level of disclosure of derivative financial instruments from companies in the PSI20 stock index, in the Euronext Lisbon stock exchange, according to requirements of IRFS 7. A disclosure index was created, based on the reports and accounts of companies in the period 2015-2017. To analyze the evolution of the disclosure level according to companies’ characteristics (dimension, profitability, share price and auditor type), we applied a cluster analysis. The results show a high level of disclosure. This evidence may be related to the mandatory adoption of IAS / IFRS and may also reflect companies' greater concern in disclosing this type of information due to the negative impact that the global financial crisis has had on corporate performance in general. The dimension is the variable that affects disclosure. That is, there is a tendency to, the higher the company the higher the level of disclosure. However, the results show that smaller companies also have high levels of disclosure. This may be associated with greater or lesser quantity or value of derivative financial instruments used.
Keywords
Financial Instruments, Disclosure, IFRS 7
To cite this article
Francisco Leote, Clarisse Pereira, Rui Brites, Teresa Godinho, Financial Instruments’ Disclosure in Compliance with IFRS 7: The Portuguese Companies, International Journal of Accounting, Finance and Risk Management. Special Issue: Perspectives on Risk Management and Impact on Sustainability of Companies. Vol. 5, No. 1, 2020, pp. 52-61. doi: 10.11648/j.ijafrm.20200501.15
Copyright
Copyright © 2020 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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