Keeping the Promise of Global Accounting Standards (original) (raw)
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International Financial Reporting Standards (IFRS): pros and cons for investors
Accounting and business research, 2006
Accounting in shaped by economic and political forces. It follows that increased worldwide integration of both markets and politics (driven by reductions in communications and information processing costs) makes increased integration of financial reporting standards and practice almost inevitable. But most market and political forces will remain local for the foreseeable future, so it is unclear how much convergence in actual financial reporting practice will (or should) occur. Furthermore, there is little settled theory or evidence on which to build an assessment of the advantages and disadvantages of uniform accounting rules within a country, let alone internationally. The pros and cons of IFRS therefore are somewhat conjectural, the unbridled enthusiasm of allegedly altruistic proponents notwithstanding. On the 'pro' side of the ledger, I conclude that extraordinary success has been achieved in developing a comprehensive set of 'high quality' IFRS standards, in persuading almost 100 countries to adopt them, and in obtaining convergence in standards with important non-adopters (notably, the US). On the 'con' side, I envisage problems with the current fascination of the IASB (and the FASB) with 'fair value accounting'. A deeper concern is that there inevitably will be substantial differences among countries in implementation of IFRS, which now risk being concealed by a veneer of uniformity. The notion that uniform standards alone will produce uniform financial reporting seems naive. In addition, I express several longer run concerns. Time will tell.
International Journal of Disclosure and Governance
The International Accounting Standards Board (IASB) seeks to provide global financial reporting comparability of its International Financial Reporting Standards (IFRS). The objective of this study is to propose an organizational dynamic that could improve global comparability of financial reporting under IFRS through rigorous and homogeneous global enforcement. We use the qualitative framework of Gioia et al. (Organ Res Methods 16:15–31, 2012) to identify the relevant literature, methodologies, and organizational dynamics to understand the issues and changes needed to possibly achieve full-IFRS financial reporting for cross-border listed firms. We draw on previous studies that provided evidence of limitations and issues about comparability of financial reporting based on (not homogeneous) adoption, application, and enforcement of IFRS worldwide. A content analysis of IASB’s deliberations in developing its interactions with (International Organization of Securities Commissions (IOSCO...
The Impact of International Financial Reporting Standards on Global Accounting Practices
Advances In Applied Accounting Research, 2024
This study examines the impact of International Financial Reporting Standards (IFRS) on global accounting practices, focusing on financial reporting quality, economic outcomes, and the influence of regulatory and cultural contexts. Research Design and Methodology: A mixed-methods approach was employed, combining qualitative interviews with accounting professionals and quantitative analysis of financial statements from various countries. The study investigates the benefits and challenges of IFRS adoption, considering factors such as regulatory environments, cultural differences, and economic development levels. Findings and Discussion: The findings reveal that IFRS adoption enhances financial reporting quality by increasing transparency, reducing earnings management, and improving comparability of financial statements. These benefits are most pronounced in countries with strong regulatory frameworks. However, challenges include high costs and complexities of the transition process, especially for smaller firms and developing countries. Cultural and institutional factors significantly influence the effectiveness of IFRS adoption, with varying impacts across different economic contexts. Implications: The study's results underscore the need for supportive regulatory environments and adequate training for accounting professionals to facilitate effective IFRS adoption. Policymakers and regulators should consider tailored approaches to address specific challenges faced by different countries. Companies, particularly in developing regions, must plan and allocate resources carefully to manage the transition to IFRS. These insights offer practical guidance for enhancing the effectiveness of IFRS implementation worldwide.
Advancing the Harmonisation of International Accounting Standards: Exploring An Alternative Path
The International Journal of Accounting, 1997
The IASC has been actively pursuing the goal of international accounting harmonisation for two decades. Whilst there has been much productive output, little progress has been made in achieving global uniformity in accounting. In attempting to explain the lack of progress, this paper adopts the view that the cause of stagnation is the process used to mobilise harmonisation. The IASC has only recently acted upon the fact that there has not been enough examination of the processes and structure of the IASC. Yet analysis of the mobilisation process reveals a number of j7aws, among these, concerns about the institutional legitimacy of the IASC. The consequence of theseflaws is that uniform@ in reporting practices is unlikely unless alterations are mode to the mobilisation mechanism, in this instance the IASC. This paper proposes a restructuring of the IASC and the adoption of the convention method as a means to remedy the perceived flaws in the current process.
IMPLEMENTATION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS: SOME REGULATORY ISSUES
Globalization forces countries to open their market for foreign investors. As business crosses the boundaries, there arises a need for some commonly accepted and applicable financial reporting standards for the companies. Now as the world globalize, it has become imperative for India to make a format strategy for convergence with IFRS with the objective to harmonize with globally accepted accounting standards. But to cope with convergence of Indian accounting standards with IFRS, we need to address several regulatory and institutional issues which might impede smooth transition to IFRS. This paper is an attempt to explore the regulatory and institutional issues needing immediate attention of policy makers and to make some recommendation to withstand this challenge.
Journal of Accounting and Public Policy, 2008
The widespread acceptance of International Accounting Standards (IAS)/International Financial Reporting Standards (IFRS) makes it timely to examine their technical determinants as well as their implications for the accounting profession and the process of accounting harmonization. In this respect, we suggest that the principles-based approach to the standards and its inner flexibility enables the application of IAS/IFRS to countries with diverse accounting traditions and varying institutional conditions. Furthermore, the principles-based approach involves major changes in the expertise held by accountants and, hence, in their educational background, training programs, and in the organizational and business models of accounting firms. Finally, we submit that the standards set by the IAS/IFRS constitute a step forward in the process of accounting harmonization, although there is still far to go in the comparability of accounting measures across countries and regions. (M. Trombetta).
Globalization of capital markets has increased the need for harmonized accounting standards all over the world. Regulators believe that International Financial Reporting Standards (IFRS) developed by International Accounting Standards Board (IASB) provide harmonized financial statements. Although, a large number of empirical studies examined the aftermath of IFRS adoption, these studies were limited in scope. This paper reviews the extant literature, which deals with harmonization of accounting standards and presents the overall consequences of IFRS adoption. The paper then provides some future research options.
Mediterranean Journal of Social Sciences, 2014
Abstract In spite the important of the global accounting convergence of IFRS in firms operations of various countries in terms of globalization of financial markets, standardizing the diverse accounting policies around the globe and the facilitation of high quality, transparent and comparable information in financial statements. But then, only few developing and even developed nations give concerned on such global accounting convergence of IFRS. In line with this, the objective of this paper is to examine the effect of two variables i.e. IFRS acceptability and IFRS enforceability on such global accounting convergence of IFRS through the perceptions of preparers and users of financial reporting. Data of the study were collected through self – administered and online survey, in which 300 questionnaire was sent to the preparers and users of financial reporting in Nigeria. The study used convenient sampling technique; data were analyzed using Statistical Package for Social Science (SPSS) version 19. Descriptive statistic, factor analysis, correlation matrix and finally, multiple regression analysis were carried out. The result findings of the analysis revealed that, IFRS acceptability and IFRS enforceability has significant positive relation with the global accounting convergence of IFRS. Finally, conclusion was provided and the direction for future research was also provided. Keywords: IFRS acceptability, IFRS enforceability, global accounting convergence, companies
International financial reporting standards — credible and reliable? An overview
Advances in Accounting, 2010
The study discusses how IFRS's objective of the harmonization of accounting standards and improvement of quality of financial reporting may have been negatively affected due to public authorities' influences in the European Union (EU), the U.S., the U.K. and China. In addition, we discuss issues related to the inconsistent interpretations and implementations of IFRS as principle-based accounting standards. Moreover, we