Adoption Of International Accounting Standards Research Articles

THE ROLE OF INTERNATIONAL ACCOUNTING STANDARDS IN FOSTERING CORPORATE REPORTING TRANSPARENCY

This research investigates the multifaceted impact of International Accounting Standards (IAS) on corporate reporting transparency. Amidst the interconnected global business landscape, the study aims to discern global adoption trends, financial reporting quality, stakeholder perceptions, implementation challenges, and the responsiveness of IAS to industry dynamics. Through meticulous analyses spanning the years 2010 to 2020, the research unfolds key insights.The adoption of IAS is a critical facet of global financial reporting, influencing business practices, investor decisions, and regulatory frameworks. Understanding its impact is paramount for policymakers, standard-setters, and businesses navigating an increasingly interconnected and diverse financial ecosystem.This research seeks to comprehensively examine the intricate relationship between IAS and corporate reporting transparency. By delving into adoption trends, financial metrics, stakeholder perspectives, implementation challenges, and update responsiveness, the study aims to provide a holistic view of the global accounting landscape.The analysis reveals a consistent upward trajectory in global IAS adoption, with North America and the Asia-Pacific region playing pivotal roles. Financial reporting quality experiences substantial improvements, particularly benefiting smaller enterprises. Stakeholder perceptions vary across regions and professional roles, emphasizing the need for tailored communication strategies. Implementation challenges, including legal framework complexities and cultural differences, underscore the intricate nature of global adoption. The frequency of IAS updates showcases the adaptability of standards to emerging trends, emphasizing sector-specific implications.This research concludes that IAS significantly influences corporate reporting transparency, offering a standardized framework for diverse business scales. Challenges in implementation necessitate targeted interventions, with recommendations focusing on stakeholder communication, tailored support for small enterprises, and addressing legal and cultural complexities. The adaptability of IAS to industry dynamics reaffirms its role as a responsive and evolving standard. As businesses, regulators, and standard-setters move forward, continuous collaboration and flexibility become imperative for navigating the complexities of a globally harmonized financial reporting landscape.

Governance quality and international accounting standards adoption by microfinance institutions

Cette recherche part du principe qu'une gouvernance forte conduit les dirigeants à faire des choix comptables qui améliorent la transparence et la qualité de l'information financière. Sur la base d'un échantillon d'institutions de microfinance notées sur la période 2005-2012, notre étude montre que les institutions de microfinance (IMF) ayant une meilleure qualité de gouvernance d'entreprise sont plus susceptibles d'adopter les normes internationales d'information financière. Cet effet est plus marqué pour les IMF financièrement dépendantes.

International Accounting Standards and their Impact on the Banking Sector Performance

The performance of the banking industry in the Kurdistan area of Iraq is the focus of this study, which explores the influence that International Accounting Standards (IAS) have had on the situation. The purpose of this study is to determine the degree to which IAS has been implemented in the banking industry, the factors that have an influence on the implementation of IAS, and the effect that IAS implementation has had on the financial performance of banks in the region. Data was collected from a sample of 142 banking professionals located throughout the region using a quantitative research technique. According to the findings of the study, the percentage of financial institutions that have adopted International Accounting Standards (IAS) is rather low, and the majority of financial institutions continue to rely on their own national accounting standards. It was discovered that the implementation of IAS has a large and beneficial effect on the performance of banks, with fully adopting banks demonstrating improved levels of profitability, liquidity, and asset quality. Education and training were shown to be the most important predictor variables in the banking sector in the region when attempting to explain the adoption of International Accounting Standards (IAS). The lack of resources and technical knowledge in the region was cited as the reason for the sluggish adoption of IAS in the region. According to the findings of the study, there is a need to improve education and training, raise awareness of international accounting standards (IAS), encourage regulatory support, provide technical assistance, and promote international collaboration in order to increase the likelihood that IAS will be adopted in the banking sector in the Kurdistan region of Iraq.

Measuring Financial Reporting Quality in Private Banks: A Comparative Study Between Banks Adopted International Accounting Standards and Banks Adopted Local Accounting Standards

This research examines financial reporting quality in the banking sector of developing countries. through testing whether managers manipulate estimated components of Loan Loss Provision (LLP). And since accounting estimation process depends on professional judgment and flexibility granted by accounting standards. This research hypothesizes that the adoption of international accounting standards improves financial reporting quality in developing countries by limiting earnings management behavior. However, theresults showed that financial reports based on local accounting standards are better than financial reports based on international accounting standards. The findings were discussed. Some recommendations and suggestions were provided

Implementation of Accounting Standards for Cryptocurrency Companies in Indonesia

The development of number of cryptocurrency startups around the world, including in Indonesia, is increasing every year, demanding business people to provide financial services by accepting the presence of cryptocurrency technology directly in the real world. The purpose of this study is to explore the application of the Statement of Financial Accounting Standards (PSAK) adopting International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) on cryptocurrency companies at the Indonesian National Indodax Company (Bitcoin Indonesia). This research method is descriptive qualitative with data collection methods using interview and observation techniques. The results show that the Indodax Company (Bitcoin Indonesia) uses IAS 2 inventory because the company's core business is in brokerage, which measures cryptocurrency inventory recorded at fair value after deducting costs to sell and is recognized in the income statement and reported in the Available for sale financial asset account. At the same time, the entity applies IAS 38 intangible assets in the measurement, valuation, and presentation of financial statements that refer to computer software and internet domains, not cryptocurrency assets in the form of coins and tokens. In addition, entities that measure and value cryptocurrency assets (cash and tokens) using financial instruments IFRS 9 Financial Instruments: Recognition and Measurement are calculated and recorded as financial assets at fair value through profit or loss (FVTPL).

ANALYSIS OF DETERMINANTS OF BOOK-TAX DIFFERENCES: EVIDENCE FROM FRENCH LISTED COMPANIES

The key objective of our research paper consists of consulting the set of explicative factors relative to book-tax differences within the French context especially after the mandatory adoption of international accounting standards, IAS/IFRS, by listed companies. Attributing several regulatory and empirical arguments in a special framework, the focus was on factors linked with non-discretionary (or regulatory) book-tax differences (goodwill and other intangibles assets, income or loss associated to the equity method as well as to the minority interest and deferred tax) and factors linked with discretionary book-tax differences (earnings management and/or tax management). Considering a panel of 1120 observations, the analysis of regression showed that tax management through downward earning management apprehended by discretionary accruals positively affects discretionary book-tax differences. Besides, tax management practices combined with earnings management via institutional ownership negatively affected discretionary differences. Moreover, the tax management policy practiced by companies measured by the effective tax rate reduced the level of discretionary book-tax differences. The current study shed light on whether various factors could affect book-tax differences via a multi-theory framework. Indeed, book-tax differences play a remarkable role in informing not only fiscal authorities but also external investors in the real financial situation of the company. To my mind, this study represented the first analysis aiming to explore determinants of book-tax differences in the French context particularly in the consolidated accounts of listed companies.

Adoption of International Accounting Standards in Emerging Countries: A Cultural Perspective

The article aims at studying the adaptability of international accounting standards to emerging countries. We use a cultural approach based on the accounting subculture (Gray, 1988) that highlights the relationship between cultural dimensions (power distance, uncertainty avoidance, individualism vs. collectivism, masculinity vs. femininity), and accounting values (professionalism vs. statutory control, uniformity vs. flexibility, conservatism vs. optimism and discretion vs. transparency). The cultural approach reveals the magnitude of adaptability of international accounting standards to emerging countries by considering the Tunisian example. Thus, we first identify the culture of the studied context by a questionnaire including the evolution tendency of this context. Secondly, we identify the cultural context required to adopt the international accounting referent. Our results reveal that the Tunisian cultural context is slightly different from that required for the adoption of the international referent. However, we have observed a process of convergence towards it.

Cash Flow Analysis Based on International Accounting Standards (IAS): A Critical Evaluation

Purpose: The purpose of this article is to investigate the importance of using financial ratio analysis following the adoption of International Accounting Standards. Design/methodology/approach: The methodology used investigates the theoretical aspects related to the purpose of financial statements analysis and the introduction of IAS, critically evaluating their differences with Greek Accounting Standards as well. Furthermore, it presents how to prepare the Cash Flow Statement. Findings: The study of cash flows and their use contributes to the understanding of the ability of an entity to generate cash and cash equivalents through its operating activities and to ensure its smooth operation through its investment and financing activities. Originality: The study assesses the importance of the IAS financial ratio analysis, studying the contributions of the Cash Flow Statement to different sources of activities, and evaluating the application of the direct and indirect methods.

Ownership Type, IFRS Adoption and Unconditional Conservatism

Purpose: The purpose of this study is to investigate how private and public firms vary with respect to unconditional conservatism levels in financial reporting. The study also examines whether adoption of international accounting standards affects the association between conservatism and organizational form. Design/methodology/approach: This study uses a large Indian sample of almost 63,000 firm-year observations across more than 15,500 firms (~41% of which are private firms) over 10 years (2011-2020) with multivariate regressions. Findings: The study shows that private firms are less unconditionally conservative than public firms. Also, contrary to extant literature, adoption of international accounting studies increases conservatism for all firms in the context under study. However, the newer standards moderate and reduce the conservatism gap between private and public firms. These results hold even after controlling for monitoring, governance, and group affiliation. Originality/value: To the best of my knowledge, this is the first study that explores unconditional conservatism across private and public firms in an emerging market context which is very different from the developed world. This adds significantly to our understanding of how organization type impacts financial reporting. Within this framework, the study of different accounting standards also helps show that the effect of IFRS-like standards on reporting choices varies significantly by context and region.

The Internationalization and Voluntary Adoption of International Accounting Standards by Japanese MNEs

The Internationalization and Voluntary Adoption of International Accounting Standards by Japanese MNEs

Factors affecting the adoption of International Accounting Standards (IAS): Empirical evidence from Bangladesh

This study aims to find the influential factors of adopting International Accounting Standards (IAS) in the banking industries of Bangladesh. This study is based on two-stage least-squares method for 561 unbalanced panel observations of 32 commercial banks in Bangladesh over the period from 2000 to 2018. To analyze the study, it uses macroeconomic and bank-level variables in which probability of IAS adoption, economic growth, and profitability are the main variables. The findings of the study indicate that economic growth has a significant relationship with IAS adoption in the banking industries of Bangladesh, as well as all variables relating to profitability affect IAS adoption excluding return on equity (ROE). SIZE and CAR do not influence IAS adoption from the bank-level variables, liquidity has a significant and negative relationship with IAS adoption and assets growth and total loan and advances (TLAs) have a significant impact on the IAS in banking industries of Bangladesh. The result of the study will be supportive to deliver precious information and unfathomable understanding as regards IAS and factors influencing IAS in banking sector. This is worthwhile to the researchers, students, and policy-makers while making critical decision about the adoption and implementation of IAS. Based on this study, it was suggested among others that adoption of IAS should to be a dynamic part of bank’s strategy because it upturns quality of reporting by increasing transparency, comparability, and acceptability.

The relevance of financial and economic informational environment: evidence from South Asian markets

PurposeThis study aims to explore the firm's specific, opacity and economy-specific variables to explain the variation in South Asian market returns and indicate that how the difference in adoption of accounting standards refers to the effect of the movement in stock returns.Design/methodology/approachFollowing the scope of the study, factor analysis, fixed effect, Driscoll and Kraay standard errors (DKSE) and Panel Corrected standard error (PCSE) models have been inducted to determine the influence of firm-specific, opacity and economy-specific variables on stock returns. The sample of study comprises 1,885 firms from five countries located in the South Asia region with the period 2005–2018. To ensure the reliability of data, firm-specific data have been collected from DataStream International, while an international country risk guide was used to compile the data for economy-specific variables.FindingsThis study concluded that firm-specific variables showed a consistent and significant association with stock return except for beta, accrual and momentum while earning aggressiveness was the only factor in opacity measure to capture the variation in stock return. The implementation of international accounting standards seemed to be significant and proves to be helpful to enhance the quality of accounting information.Research limitations/implicationsThe limitations of this study comprised the estimation error by avoiding the firm's observations with negative equity in case of earning opacity and majority (more than 50%) of the observation belongs to a single market as India out of final sample which leads to having biasedness in findings.Practical implicationsThis study helps the investors to consider the firms with smaller market capitalization and lower book to market ratio and avoid the momentum strategy under firm specific factors. Moreover, earning aggressiveness under opacity domain capture the variation in stock return and must be considered while investing funds.Originality/valueThe influence of adoption of international accounting standards along with firm and economy specific variable in South Asian Equity Markets return was the major contribution. Moreover, the inclusion of DKSE and PCSE models to examine the relevance of the financial and economic informational environment was also considered as a part of major contribution of this study.

Impacto da Adoção das Normas Internacionais de Contabilidade na Análise do Capital de Giro

The adoption of international accounting standards brought significant changes in Brazilian accounting practices. Considering these changes, there is the possibility that they have an impact on all the balance sheet analysis indicators that are carried out based on the published financial statements, as well as on working capital indices. Therefore, this study aims to verify the impact of the adoption of international accounting standards on the indicators of dynamic analysis of working capital, according to the Fleuriet Model, in the companies listed on B3. We conducted a research with quantitative approach. The sample is composed of 131 companies belonging to the sectors of Industrial Goods, Cyclic Consumption, Non-Cyclic Consumption, Basic Materials, Oil, Gas and Biofuels, Health, Information Technology and Telecommunications. The following statistical techniques were used: Kolmogorov-Smirnov and Shapiro-Wilk normality tests; T-student and Wilcoxon to verify the significance of two means. The main results of this research were that the adoption of international standards impacted working capital indicators by the Fleuriet Model. It should be noted that as of 2007 there is an average balance of companies in the growing sample of Treasury and Net Working Capital, which may be the result of the adoption of international accounting standards.

Determinants of public sector accounting reforms

Purpose The purpose of this paper is to extend the New Public Financial Management concept and the contingency model approach to an analysis of the determinants of the accrual-based International Public Sector Accounting Standards (IPSAS) adoption process as a financial management reform in Sri Lanka, a developing country in Asia. Design/methodology/approach Based on the prior literature, this paper develops a framework to highlight the importance of accrual-based reforms in public sector accounting policies to enable better transparency and accountability. It shows the extent to which Sri Lankan public sector institutions have adopted IPSAS-based accounting standards and the limitations of adopting these standards in a developing country, using documentary analysis. Findings In developing countries, the public sector faces practical problems when adopting reforms due to limited institutional capacity, high political involvement and bureaucracy in decision making. This paper concludes that significant policy changes towards the adoption of international accounting standards have gained momentum over the last decade in Sri Lanka while the much larger economies in Asia are still studying this process. However, the prevailing political uncertainty in Sri Lanka has negatively impacted the implementation process. Originality/value Relatively little is known about the diffusion of, and the difficulties in, implementing accrual-based IPSAS in the Asian region. This paper is an attempt to fill this gap by exploring the Sri Lankan experience. This could be applied by other developing countries in Asia, including the high-growth nations, for policy adoption and accounting harmonisation.

The Influence of the Environmental Factors on the Adoption of the International Accounting System IAS/IFRS: Case of Iraq

Purpose: This research aims to study the impact of local environmental factors on the adoption of International Accounting system in Iraq. So the main objective of the research can be the evaluation of the role of local environmental factors in selecting the best method to adopt International Accounting Standards (IAS), and International Financial Reporting Standards (IFRS). Design/methodology/approach: The researchers prepared a questionnaire contains 28 paragraphs which were coded and divided into 7 parts showing the independent variables of the study (the environmental factors) and the dependent variable (the adoption of IAS/IFRS) Findings: The results of the research show that the local environment factors can effect on the choice of the country to adopt the best method of IAS/IFRS adoption, and the statistical analysis results show that there is a very good level of agreement for the participants about the effect of local environment factors on the adoption of IAS/IFRS. Practical implications: The research offers insights to the need to activate national standards and principles that are appropriate to the local environment in order to adapt with the requirements of IAS/IFRS adoption. Originality/value: The research presents significant pragmatic evidence in terms of its meticulous approach towards checking the robustness of results.

The Influence of the Environmental Factors on the Adoption of the International Accounting System IAS/IFRS: Case of Iraq

Purpose: This research aims to study the impact of local environmental factors on the adoption of International Accounting system in Iraq. So the main objective of the research can be the evaluation of the role of local environmental factors in selecting the best method to adopt International Accounting Standards (IAS), and International Financial Reporting Standards (IFRS). Design/methodology/approach: The researchers prepared a questionnaire contains 28 paragraphs which were coded and divided into 7 parts showing the independent variables of the study (the environmental factors) and the dependent variable (the adoption of IAS/IFRS) Findings: The results of the research show that the local environment factors can effect on the choice of the country to adopt the best method of IAS/IFRS adoption, and the statistical analysis results show that there is a very good level of agreement for the participants about the effect of local environment factors on the adoption of IAS/IFRS. Practical implications: The research offers insights to the need to activate national standards and principles that are appropriate to the local environment in order to adapt with the requirements of IAS/IFRS adoption. Originality/value: The research presents significant pragmatic evidence in terms of its meticulous approach towards checking the robustness of results.

A percepção de docentes acerca da contribuição da filosofia para a formação do contador no Brasil sob a vigência das Financial Reporting Standards (IFRS)

A adoção às normas internacionais de contabilidade requer a capacidade de julgamento por parte dos discentes de Ciências Contábeis a fim de realizarem tomadas de decisão que envolvam subjetivismo profissional, advindo de uma contabilidade baseada em princípios. Assim, este estudo exploratório tem por objetivo investigar a relevância da Filosofia para a formação do contador no Brasil sob a vigência das IFRS. Foram realizadas dez entrevistas semiestruturadas com docentes que ministram disciplinas que abordam as normas contábeis nos cursos de Ciências Contábeis em universidades públicas no estado do Rio de Janeiro, sendo os dados analisados segundo a metodologia de análise de conteúdo e com auxílio do software Nvivo11. Verificou-se que a Filosofia é relevante e agrega positivamente a formação do futuro profissional contábil, visto que auxilia os discentes no que tange lidar com o subjetivismo advindo da adoção às normas internacionais de contabilidade, além de estimular a criticidade dos mesmos.

EARNINGS QUALITY AND IFRS: ANALYSIS OF BRAZILIAN COMPANIES OF THE BANKING SECTOR LISTED ON THE B3

The objective of this research is to analyze whether there was an increase in the quality of the information of companies of the banking sector listed on Brazil, Bolsa, Balcão (B3), by the adoption of accounting standards of the IASB, and whether the earnings persistence of publicly held companies in the banking sector increased by the adoption of the IFRS standard and whether the fair value had any impact on this relationship. The sample comprises 25 companies from the banking sector of B3 over a period of 12 calendar years, i.e., from 2004 to 2009 and from 2011 to 2016. The tests were carried out considering net income. We used data from published financial statements made available to the general public on the B3 website. The results confirmed only the first hypothesis, which demonstrated that the quality of Brazilian banking sector earnings, based on persistence, increased by the adoption of international accounting standards. On the other hand, the results pointed out that the realization of the adjustment to fair value of financial instruments did not change the persistence of earnings of all 25 companies analyzed.

Does IFRS Adoption Accelerate M&A? The Consequences of Different Goodwill Accounting in Japan

This study investigates how the gap in goodwill accounting between the Japanese local accounting standards (Japanese generally accepted accounting principles) and international accounting standards (International Financial Reporting Standards) is related to the likelihood of firms adopting international accounting standards and the merger and acquisition transactions that result. The study first examines whether the adoption of international accounting standards is associated with the past merger and acquisition activities of adopters and their goodwill ratio. Second, to control for possible self-selection bias arising from the firms’ incentives for adopting international accounting standards, propensity score matching is employed to select control firms that used Japanese local accounting standards and have a similar probability of adoption of international accounting standards. Third, whether there was any difference in the number of merger and acquisition transactions is examined, as well as the goodwill ratio, between the period before and after the adoption of international accounting standards. Firms that are actively involved in merger and acquisition transactions have a higher probability of voluntary adoption of international accounting standards than those following Japanese local standards. Further, adopters of international accounting standards experience a larger increase in the number of merger and acquisition transactions than those adopting local standards. While the goodwill ratio among adopters of international accounting standards was higher than that for adopters of Japanese local accounting standards, there is no evidence that the former increase the goodwill ratio after adoption.

The Effect of the Adoption of International Accounting Standards No. 12 (IAS No.12) for Firms Reporting Losses: Evidence from Korea

This study examines the effects of the adoption of International Accounting Standards No. 12, Income Taxes (IAS No.12) on the incremental information about future profitability for firms reporting losses compared to Korean Generally Accepted Accounting No.16, Accounting for Income Taxes (K-GAAP No.16). Specifically, this paper shows that whether the IAS No.12 affects the information of deferred tax assets (DTAs) regarding loss persistence which implies the ability to predict earnings sustainability. Using a sample of 2,905 observations from Korean listed firms that reported a loss between 2007 and 2014, we divide loss firm-years into categories of ‘good news’ (GN) or ‘bad news’ (BN) based on whether management appears to report an increase in DTAs. We find that our tax categories have incremental information about the probability of loss reversal under K-GAAP No. 16, but under IAS No.12 the incremental effects of a deferred tax balance disappear. Also, we find that investors underweight the informativeness of DTAs under K-GAAP, and after the adoption of IAS No.12, investors cannot obtain buy-and-hold returns by buying GN firm-years and selling BN firms-years. However, this is not because investors understand the information of DTAs, but because the informativeness of DTAs deteriorates after the relaxation in the recognition threshold of DTAs.