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Title: Relevance and faithful representation (reliability) of annual and semi-annual financial statements; a trade-off?

Authors: Alexios Kythreotis; Milad Soltani

Addresses: Department of Accounting, Economics and Finance, European University Cyprus, Room 9, 1st Floor, Tower Building Block C, No. 6, Diogenous Str., 2404 Engomi, Nicosia, P.O. Box 22006, 1516 Nicosia, Cyprus ' Department of Accounting, Economics and Finance, European University Cyprus, Room 9, 1st Floor, Tower Building Block C, No. 6, Diogenous Str., 2404 Engomi, Nicosia, P.O. Box 22006, 1516 Nicosia, Cyprus

Abstract: This study aims to shed light on the inconclusiveness of attaining attributes of relevance and reliability of reported accounting information in financial statements. For this reason, the degree of relevance and reliability of annual and semi-annual financial statements is examined. The sample consists of 321 manufacturing companies in the form of panel data from 2012 to 2019. The study shows a trade-off between relevance and reliability between annual and semi-annual financial statements. It is the first effort to detect any trade-off in relevance and reliability between semi-annual and annual financial statements. Additionally, this study measures the quality dimensions as presented in the conceptual framework of IFRS and highlights the conflict between existing methods measuring reliability with the IFRS conceptual framework's rationality.

Keywords: relevance; faithful representation; reliability; conceptual framework; annual and semi-annual financial statements.

DOI: 10.1504/IJMFA.2023.131779

International Journal of Managerial and Financial Accounting, 2023 Vol.15 No.3, pp.393 - 412

Received: 08 Oct 2021
Accepted: 12 Jan 2023
Published online: 30 Jun 2023 *