Abstract
Research background: Globalization currently impacts every aspect of economic life. Accounting and the law that govern it are no exceptions. The interconnectedness of companies across state boundaries brings with itself challenges to the accounting practices around the world. The globalization in the world of accounting is represented with the movement for harmonization of accounting practices around the world. International Financial Reporting Standards (IFRS) are a vehicle for that harmonization. Slovak Republic also allows companies to publish their financial statements in accordance with the IFRS standards. Therefore, it is important to study them and their effect on Slovak accounting law and practice. Purpose of the article: In this article, we will look at the accounting harmonization that resulted from the globalization of the world economy and the impact it had on accounting in the Slovak Republic. We will also look closer at International Financial Reporting Standards (IFRS) in Slovak Republic – their use, regulations governing them and potential implications for future. Methods: We use the methods of analysis and synthesis of current literature and law concerning the regulation of accounting in Slovakia with the focus on the impact of globalization on it. We then analysed the current state of use of International Financial Reporting Standards in Slovakia. Findings & Value added: We found a high level of accounting harmonization with the European Union.
Highlights
Globalization currently impacts every aspect of economic life
Slovak Republic allows companies to publish their financial statements in accordance with the International Financial Reporting Standards (IFRS) standards
From these data we can see a relatively stable development of the number of companies reporting their individual financial statements according to international IFRS standards with a slightly increasing tendency
Summary
Globalization currently impacts every aspect of economic life. Accounting and the law that governs it are no exception. International Financial Reporting Standards (IFRS) are a vehicle for that harmonization. International Financial Reporting Standards (IFRSs) are a tool for global harmonization, or approximation, of the various accounting systems of the various countries. With increasing international trade and cooperation, there has been a demand for better comparability of accounting information over time and space. This aims to standardize and harmonize financial statements and accounting procedures. IFRS represents worldwide effort to increase financial statement transparency, clarity, usability, and reliability and are currently used for publicly traded companies in almost 75% of the countries worldwide. IFRS represents worldwide effort to increase financial statement transparency, clarity, usability, and reliability and are currently used for publicly traded companies in almost 75% of the countries worldwide. (Savova, 2021) The economic results of a company are often the only source of information that informs the company's partners about the managerial activities of their company, it is necessary to present these economic results using real numbers. (Blazek et al, 2020) The quality of accounting information is important for the managers (Liem and Hien, 2020) and for the performance of the company. (Al-Delawi et al, 2020) This quality is determined by proper regulation by a set of principles and rules which help build trust with investors. (Irwandi and Pamungkas, 2020; Nedeliakova et al, 2014) A lacking or weak regulation of accounting can lead to low quality financial statements, fraudulent financial reporting and earnings management. (Svabova et al, 2020) (Vagner et al, 2021) There is need for companies to improve their internal systems. (Vagner, 2016) Corporate governance plays a role in ensuring the functioning of companies in accordance with formulated objectives to ensure their good performance. (Grofcikova, 2020) Others doing research are for example Robinson (2020)
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
