Fair Value and Stakeholder-Oriented Accounting Systems: Some Evidence from Italy

Corporate Ownership and Control, Vol. 4, pp. 127-138, Fall 2006

Posted: 17 Oct 2006

See all articles by Giovanni Melis

Giovanni Melis

University of Cagliari

Andrea Melis

University of Cagliari

Alessandro Pili

University of Cagliari

Abstract

This paper examined the key issues related to the effects of introduction of fair value in a stakeholder-oriented accounting system. In particular, it discussed how the decision of the Italian policymaker to limit the distribution to shareholders of fair value gains is rooted on the importance of prudence in the Italian legal and GAAP framework. The paper seek to explore how the importance of the 'prudence' principle in the Italian legal and GAAP framework seems mainly due to the influence of broadly defined corporate governance issues, such as ownership, control and capital structures that characterise Italian listed companies, the concept of the corporation as generally accepted in Italy, and cuntural issues, in relation to prudence, risk-taking and uncertainty avoidance. This paper argued that the Italian regulator decision seems able to safeguard the interests of a wide range of corporate stakeholders, without lowering the quality of information to investors, and provided an example of income statement section (named comprehensive income statement) in which fair value gains and losses may be disclosed.

Keywords: fair falue, IFRS, Italy, corporate governance, comprehensive income statement, stakeholders, accounting systems

JEL Classification: M41, M44, M47, M49, G34, K22

Suggested Citation

Melis, Giovanni and Melis, Andrea and Pili, Alessandro, Fair Value and Stakeholder-Oriented Accounting Systems: Some Evidence from Italy. Corporate Ownership and Control, Vol. 4, pp. 127-138, Fall 2006, Available at SSRN: https://ssrn.com/abstract=937857

Giovanni Melis

University of Cagliari ( email )

Viale S.Ignazio 17
I-09123 Cagliari
Italy

Andrea Melis (Contact Author)

University of Cagliari ( email )

Dipartimento di Scienze economiche ed aziendali
Viale S. Ignazio 17
Cagliari, 09123
Italy
+39-070-6753302 (Phone)
+39-070-6753321 (Fax)

HOME PAGE: http://people.unica.it/andreamelis

Alessandro Pili

University of Cagliari ( email )

Cagliari, 09124
Italy

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