The impact of International Financial Reporting Standards adoption as accounting regulations on the accounting information effectiveness of listed Saudi companies

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Abstract

This research aims to assess the impact of the International Financial Reporting Standards (IFRS) adoption on the accounting information effectiveness of listed firms in the Kingdom of Saudi Arabia (KSA). To achieve this aim, the researcher used a price-modified model to test market value per share (MVPS), equity book value per share (EBVPS), and earnings per share (EPS) (Ohlson, 1995). The data were obtained from the annual reports of 25 firms that applied IFRS in 2017 for the period from 2015 to 2019 from the Saudi Exchange (Tadawul) database. Sampled firms are from different sectors such as energy, communication, health care, industry, utilities, and materials. There were no financial enterprises, such as banks and insurance firms, within the research sample as they were applying different reporting requirements. The research sample consists of 127 observations. The results of this research discovered that the IFRS application has a positive result on the accounting information effectiveness measured by MVPS, EBVPS, and EPS in the KSA. This result was observed after the IFRS applying period (2017–2019) in determining MVPS, the EBVPS, and EPS. These findings are consistent with some previous studies.

Keywords: IFRS, Effectiveness of Accounting Information, Market Value per Share, Equity Book Value per Share, Earnings per Share, Kingdom of Saudi Arabia (KSA)

Authors’ individual contribution: The Author is responsible for all the contributions to the paper according to CRediT (Contributor Roles Taxonomy) standards.

Declaration of conflicting interests: The Author declares that there is no conflict of interest.

JEL Classification: G10, M40, M41

Received: 18.08.2024
Revised: 28.11.2024; 14.04.2025; 12.06.2025
Accepted: 08.07.2025
Published online: 10.07.2025

How to cite this paper: Osemy, A. Z. Z. (2025). The impact of International Financial Reporting Standards adoption as accounting regulations on the accounting information effectiveness of listed Saudi companies. Journal of Governance & Regulation, 14(3), 8–18. https://doi.org/10.22495/jgrv14i3art1