Did Australian Firms Choose to Switch to Reporting Operating Cash Flows Using the Indirect Method?

Bond, D; Bugeja, M; Czernkowski, R

Did Australian Firms Choose to Switch to Reporting Operating Cash Flows Using the Indirect Method?

Bond, D

Bugeja, M

Czernkowski, R

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Publication Type:: Journal Article
Citation:: Australian Accounting Review, 2012, 22 (1), pp. 18 - 24
Issue Date:: 2012-03-01

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Field	Value	Language
dc.contributor.author	Bond, D https://orcid.org/0000-0001-5134-4469	en_US
dc.contributor.author	Bugeja, M https://orcid.org/0000-0002-1941-5092	en_US
dc.contributor.author	Czernkowski, R https://orcid.org/0000-0002-8381-8304	en_US
dc.date.issued	2012-03-01	en_US
dc.identifier.citation	Australian Accounting Review, 2012, 22 (1), pp. 18 - 24	en_US
dc.identifier.issn	1035-6908	en_US
dc.identifier.uri	http://hdl.handle.net/10453/18943
dc.description.abstract	In 2007 Australian accounting standards were amended to allow a choice of presenting operating cash flows using either the direct or indirect method. This study investigates the number of ASX-listed entities that switched to the indirect format. Our results indicate that between 2007 and 2009 nine companies changed their reporting format. The firms adopting the indirect method have similar leverage, liquidity and performance to industry and size-matched controls. Given that previous research indicates that the direct method provides superior information for predicting cash flows and performance, our results will be welcomed by financial statement users and the Australian Accounting Standards Board. © 2012 CPA Australia.	en_US
dc.relation.ispartof	Australian Accounting Review	en_US
dc.relation.isbasedon	10.1111/j.1835-2561.2011.00156.x	en_US
dc.title	Did Australian Firms Choose to Switch to Reporting Operating Cash Flows Using the Indirect Method?	en_US
dc.type	Journal Article
utslib.citation.volume	1	en_US
utslib.citation.volume	22	en_US
utslib.for	150103 Financial Accounting	en_US
utslib.for	1499 Other Economics	en_US
utslib.for	1501 Accounting, Auditing and Accountability	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Accounting Discipline
utslib.copyright.status	open_access
pubs.issue	1	en_US
pubs.publication-status	Published	en_US
pubs.volume	22	en_US

Abstract:

In 2007 Australian accounting standards were amended to allow a choice of presenting operating cash flows using either the direct or indirect method. This study investigates the number of ASX-listed entities that switched to the indirect format. Our results indicate that between 2007 and 2009 nine companies changed their reporting format. The firms adopting the indirect method have similar leverage, liquidity and performance to industry and size-matched controls. Given that previous research indicates that the direct method provides superior information for predicting cash flows and performance, our results will be welcomed by financial statement users and the Australian Accounting Standards Board. © 2012 CPA Australia.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/18943