Abstract: The purpose of this study is to investigate whether firms applying International Financial Reporting Standards (IFRS), provide high-quality and comparable earnings information that is useful for decision making of information users relative to firms applying local Generally Accepted Accounting Principles (GAAP). Focus is placed on the earnings quality of listed firms in several developed countries: Australia, Canada, France, Germany, Japan, the United Kingdom (UK), and the United States (US). Except for Japan and the US, the adoption of IFRS is mandatory for listed firms in these countries. In Japan, the application of IFRS is allowed for specific listed firms. In the US, the foreign firms listed on the US securities market are permitted to apply IFRS but the listed domestic firms are prohibited from doing so. In this paper, the differences in earnings quality are compared between firms applying local GAAP and those applying IFRS in each country and industry category, and the reasons of differences in earnings quality are analyzed using various factors. The results show that, although the earnings quality of firms applying IFRS is higher than that of firms applying local GAAP, this varies with country and industry category. Thus, even if a single set of global accounting standards is used for all listed firms worldwide, it is difficult to establish comparability of financial information among global firms. These findings imply that various circumstances surrounding firms, industries, and countries etc. influence business operations and affect the differences in earnings quality.
Abstract: This paper aimed to help researchers and international companies to the differences and similarities between IFRS (International financial reporting standards) and UK GAAP or UK accounting principles, and to the accounting changes between standard setting of the International Accounting Standards Board and the Accounting Standards Board in United Kingdom. We will use in this study statistical methods to calculate similarities and difference frequencies between the UK standards and IFRS standards, according to the PricewaterhouseCoopers report in 2005. We will use the one simple test to confirm or refuse our hypothesis. In conclusion, we found that the gap between UK GAAP and IFRS is small.
Abstract: The last two decades witnessed a movement towards
harmonization of international financial reporting standards (IFRS)
throughout the global economy. This investigation seeks to identify
the factors that could explain the adoption of IFRS by poor
jurisdictions. While there has been a considerable amount of
literature published on the effects and key drivers of IFRS adoption
in both developed and developing countries, little attention has been
paid to jurisdictions with less developed capital markets and low
income levels exclusively. Drawing upon the Institutional Isomorphism theory and analyzing
a sample of 45 poor jurisdictions between 2008 and 2013, the study
empirically shows that poor jurisdictions are driven by legitimacy
concerns rather than by economic reasoning to adopt an international
accounting perspective. This in turn has implications for the IASB, as
it should seek to influence institutional pressures within a particular
jurisdiction in order to promote IFRS adoption.
Abstract: This paper explores the idea of globalisation and
considers accounting-s role in that process in order to develop new
spaces for accounting research. That-s why in this paper we are
looking for questions not necessary for answers. Adopting an
'alternative' view of accounting it-s related to the fact that we sees
accounting as social and evolutionist process, that pays heed to those
voices arguing for greater social and environmental justice, and that
draws attention to the role of accounting researchers in the process of
globalisation. The paper defines globalisation and expands the
globalisation and accounting research agenda introducing in this
context the harmonization process in accounting. There are the two
main systems which are disputing the first stage of being the
benchmark: GAAP and IFRS. Each of them has his pluses and
minuses on being the selected one. Due to this fact a convergence of
the two, joining the advantages and disadvantages of the two should
be the solution for an unique international accounting solution. Is this
idea realizable, what steps has been made until now, what should be
done in the future. The paper is emphasising the role of the cultural
differences in the process of imposing of an unique international
accounting system by the global organizations..
Abstract: In the current context of globalization, a large number of companies sought to develop as a group in order to reach to other markets or meet the necessary criteria for listing on a stock exchange. The issue of consolidated financial statements prepared by a parent, an investor or a venture and the financial reporting standards guiding them therefore becomes even more important. The aim of our paper is to expose this issue in a consistent manner, first by summarizing the international accounting and financial reporting standards applicable before the 1st of January 2013 and considering the role of the crisis in shaping the standard setting process, and secondly by analyzing the newly issued/modified standards and main changes being brought
Abstract: In the current context of globalization, accountability has become a key subject of real interest for both, national and international business areas, due to the need for comparability and transparency of the economic situation, so we can speak about the harmonization and convergence of international accounting. The paper presents a qualitative research through content analysis of several reports concerning the roadmap for convergence. First, we develop a conceptual framework for the evolution of standards’ convergence and further we discuss the degree of standards harmonization and convergence between US GAAP and IAS/IFRS as to October 2012. We find that most topics did not follow the expected progress. Furthermore there are still some differences in the long-term project that are in process to be completed and other that were reassessed as a lower priority project.
Abstract: This paper analyzes the effect of a single uniform accounting rule on reporting quality by investigating the influence of IFRS on earnings management. This paper examines whether earnings management is reduced after IFRS adoption through the use of “loss avoidance thresholds”, a method that has been verified in earlier studies. This paper concentrates on two European countries: one that represents the continental code law tradition with weak protection of investors (France) and one that represents the Anglo-American common law tradition, which typically implies a strong enforcement system (the United Kingdom).
The research investigates a sample of 526 companies (6822 firm-year observations) during the years 2000 – 2013. The results are different for the two jurisdictions. This study demonstrates that a single set of accounting standards contributes to better reporting quality and reduces the pervasiveness of earnings management in France. In contrast, there is no evidence that a reduction in earnings management followed the implementation of IFRS in the United Kingdom. Due to the fact that IFRS benefit France but not the United Kingdom, other political and economic factors, such legal system or capital market strength, must play a significant role in influencing the comparability and transparency cross-border companies’ financial statements. Overall, the result suggests that IFRS moderately contribute to the accounting quality of reported financial statements and bring benefit for stakeholders, though the role played by other economic factors cannot be discounted.
Abstract: There is limited evidence from various countries
about the possible impact of various criteria to be used to determine
the scope of the IFRS for SMEs issued in 2009 and, research is
needed in this area. We provide evidence from Romania, an
emerging economy member of the European Union. The aim of this
paper is to analyze in a local setting if size is a relevant factor for
deciding between local and global standards for SMEs. Our results
indicate that size is a moderate indicator of the existence of possible
users interested in financial statements and that there is a difference
between the scopes of the standard determined on various criteria..
Also, we suggest that the international exposure is quite reduced in
the case of SMEs, but is sufficient to suggest that at least some SMEs
would benefit from international comparability of financial
statements
Abstract: The IFRS for Small and Medium-sized Entities
(SMEs) was issued in July 2009 and currently regulators are
considering various implementation strategies of this standard.
Romania is a member of the European Union since 2007, thus
accounting regulations were issued in order to ensure compliance
with the European Accounting Directives. As the European
Commission rejected recently the mandatory use of IFRS for SMEs,
regulatory bodies from the Member States have to decide if the
standard will affect or not the accounting practices of SMEs from
their countries. Recently IASB invited stakeholders to discuss the
revision of IFRS for SMEs. Empirical studies on the differences and
similarities between national standards and IFRS for SMEs could
inform decision makers on the actual level of convergence in
different countries. The purpose of this paper is to provide empirical
evidences on the convergence of the Romanian regulations with IFRS
for SMEs analyzing the results in the context of the last revisions
proposed to the EU Accounting Directives.
Abstract: The move towards internationalization of accounting encountered a great boost, when in 2002 EU delegated the IASB to provide the accounting standards to be applied inside its frontiers. Among the incentives of the standardization of accounting on the international level, is the reduction of the cost of capital. Romania made the move towards IFRS before EU, when the country was not yet a member of it. Even if this made Romania a special case, it was scarcely approached. The leak of real data is usually the reason for avoiding. The novelty of this paper is that it offers an insight from the reality of Romanian companies and their view regarding the IFRS. The paper is based on a survey that the authors made among the companies listed on the first two tiers of the Bucharest Stock Exchange (BSE), which are basically, the most important companies in the country.
Abstract: This paper investigates the effect of International
Financial Reporting Standards (IFRS) adoption on the frequency of
earnings managements towards small positive profits. We focus on
two emerging markets IFRS adopters: South Africa and Turkey.
We tested our logistic regression using appropriate panelestimation
techniques over a sample of 330 South African and 210
Turkish firm-year observations over the period 2002-2008. Our
results document that mandatory adoption of IFRS is not associated
with a reduction in earnings management towards small positive
profits in emerging markets. These results contradict most of the
previous findings of the studies conducted in developed countries.
Based on the legal system factor, we compare the intensity of
earnings management between a code law country (Turkey) and a
common law country (South Africa) over the pre and post-adoption
periods. Our findings show that the frequency of such earnings
management practice increases significantly for the code law
country.
Abstract: Increase in globalization of capital markets brings the
higher requirements on financial information provided for investors
who look for a highly comparable information. Paper deals with the
advantages and limitations of applying International Financial
Reporting Standards (IFRS) in the Czech Republic and Ukraine. As a
greatest limit for full adoption of IFRS shall be acknowledged the
strong connection of continental accounting to tax system and
enormous high administrative burden for IFRS appliers.
Abstract: Although agriculture is an important part of the world
economy, accounting in agriculture still has many shortcomings. The
adoption of IAS 41 “Agriculture” has tried to improve this situation
and increase the comparability of financial statements of entities in
the agricultural sector. Although controversial, IAS 41 is the first
step of a consistent transition to fair value assessment in the
agricultural sector. The objective of our work is the analysis of IAS
41 and current accounting agricultural situation in Romania.
Accounting regulations in Romania are in accordance with European
directives and, in many respects, converged with IFRS referential.
Provisions of IAS 41, however, are not reflected directly in
Romanian regulations. With the increase of forest land transactions,
it is expected that recognition and measurement of biological assets
under IAS 41 to become a necessity.