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Impaired translations: IFRS from English and annual reports into English

Research output: Contribution to journalJournal article

Published
<mark>Journal publication date</mark>17/09/2018
<mark>Journal</mark>Accounting, Auditing and Accountability Journal
Issue number7
Volume31
Number of pages25
Pages (from-to)1981-2005
Publication statusPublished
Early online date28/08/18
Original languageEnglish

Abstract


Purpose
The purpose of this paper is to examine translation in the context of International Financial Reporting Standards (IFRS) by taking the example of the English term “impairment” in IAS 36, and following it into 19 translations. The paper then examines the terms used for impairment in English translations of annual reports provided by firms. Consideration is given to the best approach for translating regulations and whether that is also suitable for the translation of annual reports.

Design/methodology/approach
The two empirical parts of the paper involve: first, identifying the terms for impairment used in 19 official translations of IAS 36, and second, examining English-language translations of reports provided by 393 listed firms from 11 major countries.

Findings
Nearly all the terms used for “impairment” in translations of IAS 36 do not convey the message of damage to assets. In annual reports translated into English, many terms are misleading in that they do not mention impairment, peaking at 39 per cent in German and Italian reports in one year.

Research limitations/implications
Researchers should note that the information related to impairment in international databases is likely to contain errors, and the authors recommend that data should be hand-collected and then carefully checked by experts. The authors make suggestions for further research.

Practical implications
Translators of regulations should aim to convey the messages of the source documents, but translators of annual reports should not look only at the reports but also consult the terminology in the original regulations. The authors also suggest implications for regulators and analysts.

Originality/value
The paper innovates by separately considering regulations and annual reports. The authors examine a key accounting term systematically into a wide range of official translations. The core section of the paper is a new field of research: an empirical study of the translations of firms’ financial statements.

Bibliographic note

This article is (c) Emerald Group Publishing and permission has been granted for this version to appear here. Emerald does not grant permission for this article to be further copied/distributed or hosted elsewhere without the express permission from Emerald Group Publishing Limited.