Deviations from the Mandatory Adoption of IFRS in the European Union: Implementation, Enforcement, Incentives, and Compliance

Pownall, Grace; Wieczynska, Maria

doi:10.2139/ssrn.1919805

Cited by 15 publications

(10 citation statements)

References 21 publications

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“…Our sample includes these “late adopters,” but excluding the “late adopters” from the sample does not alter our results and inferences. It is also worth noting that, due to various exemptions and deferrals, a substantial portion of firms in the European Union did not adopt IFRS for financial reporting until 2009 (Pownall and Wieczynska ). Our sample of interest thus is the firms that started using IFRS in 2005 or 2006, rather than all firms in IFRS adopting countries.…”

mentioning

confidence: 99%

Accounting Standards Harmonization and Financial Integration

Dhaliwal

et al. 2019

Contemporary Accting Res

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We empirically examine whether adopting a uniform set of accounting standards mitigates information frictions in financial markets and facilitates market integration. Using a difference‐in‐difference design, we find that after the mandatory adoption of IFRS local stock returns incorporate more global information and at a faster speed. The effect of IFRS adoption is stronger in countries where there are larger improvements in accounting comparability and for firms with a larger increase in foreign ownership. Overall, our results suggest that accounting standards harmonization facilitates financial market integration.

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confidence: 99%

Accounting Standards Harmonization and Financial Integration

Dhaliwal

et al. 2019

Contemporary Accting Res

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“…Given the findings provided by the literature about SOX and delisting, Vulcheva (2011) hypothesizes that the costs of IFRS are sufficient to force some firms to go private, and she shows an overall increase in delistings in the year of the EU's IFRS adoption. Pownall and Wieczynska (2012) also conclude that IFRS prompted firms to adopt delisting as a cost avoidance strategy. IFRS have been adopted with different levels of enforcement in different European Union countries.…”

Section: Compliance Versus Non-compliancementioning

confidence: 90%

Reasons for Delisting and Consequences: A Literature Review and Research Agenda

Martínez

Serve

2016

Journal of Economic Surveys

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This paper discusses the literature on delisting, drawing on USA and international evidence. Given the great heterogeneity in delisting operations, we first consider the standard existing typology based on the initiator of the delisting (the stock market authorities, or the firm itself). Second, while managers often cite high compliance costs (especially due to Sarbanes–Oxley Act implementation) as the official reason for the voluntary delisting of their firm, we highlight that firms face different trade‐offs in their delisting decision. We also examine the reasons for involuntary delisting, especially the delisting dilemma faced by stock market authorities when the firm violates the listing requirements. Next, we review the economic consequences of delisting in terms of value creation or value destruction for shareholders. Finally, noting gaps in the literature and other contrasting results, we propose suggestions for future research.

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“…As such this study also considers that looking for other explanatory variables may be crucial. These explanatory variables may include those based on firm characteristics as identified by several studies [27][28][29][30][31][32][33][34]19]. According to Golan et al, [35] firm characteristics are the firm's resources and objectives which influence the performance of organizations.…”

Section: Introductionmentioning

confidence: 99%

“…However, studies on the association between firm characteristics and IFRS compliance have produced conflicting results [27,29,31,34,13,59]. Notwithstanding the conflicting empirical results, there is also insufficient research on the relationship between a firm characteristics and IFRS compliance focused on developing countries [37,38].…”

Section: Introductionmentioning

confidence: 99%

Antecedents of IFRS Compliance: The Moderating Effect of Audit Quality

Kabwe¹,

Mwanaumo²,

Chalu³

2021

JFA

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Despite the significant non-compliance with IFRS, most audit reports provide unqualified opinion which brings into question the audit quality in enforcing IFRS compliance. Therefore, the purpose of the study was to examine the antecedents of compliance with IFRS by focusing on the moderating effect of audit quality on the association of firm characteristics and IFRS compliance. The collection of data was done through quantitative content analysis of annual reports of 20 Zambian listed companies and Zambia Institute of chartered Accountants covering the years 2012 to 2018. Being a longitudinal study requiring panel data analysis, a Hausman test was done to choose the model to employ. The Hausman test showed that the random effect model was suitable. Results indicate that audit quality moderates the association of firm characteristics and IFRS compliance. Also, there was a positive association between firm size and compliance with IFRS. There was a negative association between firm profitability and compliance with IFRS. However, there was a statistically insignificant positive association between foreign investors, institutional investors, audit quality and IFRS compliance. The study suggests that large companies are expected to comply more with IFRSs and profitable firms withhold financial information. Audit quality was not impaired probably due to the size of the audit firms and international affiliation. Meanwhile, the influence of institutional investors and foreign investors on IFRS compliance was insignificant probably because both institutional and foreign investors in Zambian listed companies are transient investors without significant incentives to demand financial disclosures and they may have other means to access financial information. The financial reporting regulators should focus on enhancing audit quality for listed companies in Zambia and even in other African countries. Future research can focus on the relevance of IFRS disclosures to the domestic investors in Africa considering the cultural differences both at firm and national-level.

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Deviations from the Mandatory Adoption of IFRS in the European Union: Implementation, Enforcement, Incentives, and Compliance

Cited by 15 publications

References 21 publications

Accounting Standards Harmonization and Financial Integration

Accounting Standards Harmonization and Financial Integration

Reasons for Delisting and Consequences: A Literature Review and Research Agenda

Antecedents of IFRS Compliance: The Moderating Effect of Audit Quality

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