Description
The adoption of IFRS 8 marked a major change in the segment reporting rules under IFRS. This step, however, was heavily criticized and several questions regarding IFRS 8 still remain unanswered. Therefore, this study analyzes the impact of IFRS 8 on segment reporting practice and its economic consequences. The results show that firms report on average more segment information. Moreover, segment reports from the management’s perspective are useful and mitigate information asymmetries, reduce the cost of capital and affect the work of financial analysts. The findings have implications for the IASB, preparers, auditors and users of financial statements as well as enforcement institutions. Martin Nienhaus studied Business Administration and Economics at the University of Mnster (Germany) and at Monash University in Melbourne (Australia). He worked as a research assistant for the Chair of International Accounting at the University of Mnster and at the Pennsylvania State University (USA).
