The impact of TFRS 15 revenue from contracts with earning quality of energy sector in The Stock Exchange of Thailand.

Abstract

The objectives of this research are to study: 1) The impact before and after the implementation of Financial Reporting Standard No. 15 on revenue from contracts with customers, total assets, and debt-paying ability, and their effects on accrual-based earnings quality according to management discretion. Additionally, the study examines the impact of earnings per share and book value per share on earnings quality based on the market value of companies listed in the Stock Exchange of Thailand in the energy sector. Data were collected for the period before the implementation of TFRS 15, from 2015 to 2018, and the period after its implementation, from 2019 to 2022, with a total of 12 companies in the sample group. The statistics used for data analysis include descriptive analysis and multiple regression analysis.

The research findings reveal that 1) Before the implementation of TFRS 15, total assets and debt repayment capacity had a statistically significant impact on the quality of earnings based on discretionary accruals at the 0.1 significance level. After the implementation of TFRS 15, debt repayment capacity continued to have a statistically significant impact on the quality of earnings based on discretionary accruals at the 0.1 significance level. It was found that after the implementation of TFRS 15, there was no relationship between total assets and discretionary accruals, as the recognition of items under TFRS 15 allowed companies to reduce the use of discretion. 2) Both before and after the implementation of TFRS 15, earnings per share (EPS) and book value per share (BVPS) significantly affected the market-based earnings quality at the 0.01 significance level. It was found that if a company has a higher EPS and BVPS, its market-based earnings quality will also increase.