Print ISSN  :  2708-616X     |  Online ISSN  :   2708-6178   |  DOI: https://doi.org/10.62458/160224

ABSTRACT

Following the criticism directed at IAS 39, the IASB issued a standard for financial instruments IFRS 9. This study sheds light on the impact of applying this new standard on Cambodian commercial banks’ financial performance. Using ROA and ROE as proxies of financial performance of banks and employing data manually extracted from the annual reports of Cambodian commercial banks, we analyze the impact of adopting IFRS 9 and some bank specific characteristics based on a sample of 152 bank-year observations from 2014 to 2021 to compare the financial performance of these banks before and after applying IFRS 9. The practical outcomes of the regression analysis signified that the implementation of IFRS 9 has a significant and negative influence on the financial performance of Cambodian commercial banks. The results of this study provide useful explanations which are helpful to regulators and standard setters on how banks’ performance is affected by the implementation of this new standard. This study is expected to make significant contributions to the body of literature as it is one of the first studies to examine this issue in Cambodia and it provides new evidence about the effect of this new standard on the performance of commercial banks in emerging countries.

Keywords: International Financial Reporting Standard (IFRS); International Accounting Standard (IAS); Financial performance; Return on assets; Return on equity

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