Compliance and familiarity with fixed assets' disclosure requirements and firm value

Abstract

We examine the impact of compliance and familiarity with fixed assets' disclosure requirements on firm value in Indonesia. Data were manually tabulated from 1672 financial statements of publicly listed firms during the period from 2013 to 2020 to test our hypotheses. We find that both the compliance level and familiarity level gradually increase over time. The result shows that greater compliance with IFRS accounting standards is associated with greater firm value. Interestingly, we find a negative association between the familiarity sub-index and firm value, suggesting that unfamiliarity with more complex accounting standards can lead to lower firm value.