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Journal of Competitiveness

Financial Statements According to IFRS and the Bankruptcy Model Z-score

Kubíčková Dana

Keywords:
International Financial Reporting Standards (IFRS), financial situation, assessment of financial performance, indicators, bankruptcy model

Abstract:
Financial Statements prepared according to the International Financial Reporting Standards (IFRS) provides an assessment of the financial situation and financial efficiency of enterprises compared with Financial Statements prepared according to Czech Accounting Standards (CAS). In this study, the Z-score assumption was used. The Z-score is a model for predicting the bankruptcy of firms; hence its value is also affected. The Z-score was used in testing the financial statements of the selected set of firms. The financial statements of the firms were compiled in the same period in accordance with both the IFRS and CAS. The comparison of the value of Z-score based on the two sets of financial statements disclosed that, the IFRS produced the worse assessment of the financial situation of the firm and worse prediction of future development than CAS. These comparisons are described in this article, which is part of the results of the research project of GA CR No 402/09/0225. “IAS/IFRS Usage in Small and Medium-sized Enterprises and its Influence on Performance Measurement” carried out at the FAME UTB in Zlín.

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Journal of Competitiveness

  

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ISSN 1804-171X (Print); eISSN 1804-1728 (On-line)


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The journal offers access to the contents in the open access system on the principles license Creative Commons (CC BY 4.0).