Mandatory Assurance Research Articles

Exploring Multi-level Drivers of Accountants’ Opinions on the Changes Introduced by the Corporate Sustainability Reporting Directive

This study aims to identify drivers influencing Poland-based accountants’ opinions towards stricter sustainability reporting regulations in the Corporate Sustainability Reporting Directive (CSRD). Employing a multilevel model of social change as the theoretical framework, we analysed responses from 1,076 accountants in 2021. We used logit regression, to assess accountants’ perspectives on the expansion of sustainability reporting to a greater number of companies and its mandatory assurance. Our findings reveal that drivers at transnational (international regulations and standards), organisational (benefits tied to sustainability reporting), and individual (knowledge of reporting regulations) levels positively influence support for these measures. Conversely, drivers at the national level, captured by membership in the professional accountants’ association, were irrelevant. Our findings suggest that regulatory bodies should educate accountants on the benefits of sustainability reporting to improve their receptivity to new requirements. Countries adopting sustainability reporting later may need to invest more in developing accountants’ knowledge and skills.

The Effects of CSR Report Mandatory Policy on Analyst Forecasts: Evidence from Taiwan

The Taiwanese government altered its corporate social responsibility (CSR) report management policy from voluntary disclosure and assurance of CSR reports to partial mandatory disclosure and partial mandatory assurance. This paper examines this policy’s effects on analyst forecast. The empirical results showed that the mandatory disclosure policy on CSR reports significantly increased analyst forecast accuracy and reduced analyst forecast dispersion. Furthermore, the study found that analyst forecast accuracy was further increased when CSR reports were forced to undergo accountant assurance than those without mandatory accountant assurance which means that the mandatory assurance policy on CSR reports significantly further increased analyst forecast accuracy.

Carrot or stick? An empirical analysis of the different implementation strategies of the EU directive on nonfinancial information across Europe

AbstractThe recent EU Directive on nonfinancial information (NFI) disclosure allows Member States some discretion regarding its implementation. More specifically, it allows countries to decide whether: (a) information assurance is compulsory; (b) companies can waive NFI disclosure because of possible competitive harms (safe harbor); and (c) fines can be imposed on companies not disclosing NFI. We empirically test the impact of different implementation strategies on NFI quantity and quality, and we find that regulations providing incentives ('carrots') are more effective than regulations imposing costs ('sticks'). More specifically, while mandatory assurance and safe harbor have a positive impact on NFI quantity, fines do not. Our results contribute to the literature on NFI disclosure and inform regulators on the effectiveness of different implementation strategies.