Adoption of IFRS in Japan: challenges and consequences

2015 ◽  
Vol 27 (1) ◽  
pp. 3-27 ◽  
Author(s):  
Noriyuki Tsunogaya ◽  
Andreas Hellmann ◽  
Simone Domenico Scagnelli
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Accounting System ◽  
International Accounting Standards ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Institutional Complementarity ◽  
Accounting Environment ◽  
Social Organizational

Purpose – The purpose of this study is to provide a rigorous and holistic analysis of the main features of the Japanese accounting environment. It also raises issues related to the adoption of International Financial Reporting Standards (IFRS) in Japan. Design/methodology/approach – For the purpose of investigating the Japanese accounting system, this study applies the accounting ecology framework developed by Gernon and Wallace (1995) and provides a content analysis of relevant meetings of the Business Accounting Council of Japan. Findings – The findings of this study provide evidence that it would be problematic to require the adoption of IFRS for all listed companies in Japan. The main reason for this is that the Japanese policymakers and standard-setting bodies follow two objectives: enhancing the international comparability of financial reporting and maintaining institutional complementarity between financial reporting and other infrastructures such as accounting-related laws. Research limitations/implications – This study is relevant for accounting researchers and professionals with an interest in Japanese accounting practices. It is also useful for the International Accounting Standards Board and representatives of countries planning to adopt IFRS in the future. Originality/value – The findings of this study show that contextual issues such as social, organizational and professional environments cannot be ignored in the adoption of IFRS in Japan.

Accounting for leases – lessons from COVID-19

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Alan Teixeira
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Financial Accounting ◽  
International Accounting Standards ◽  
Reporting Standards ◽  
Financial Accounting Standards Board ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Setting Process

Purpose The International Accounting Standards Board (IASB) and Financial Accounting Standards Board (FASB) have given relief to lessees in response to the coronavirus (COVID-19) pandemic. However, it is not clear why any relief from the requirements in International Financial Reporting Standards (IFRS) or the Accounting Standards Codification (ASC) should be necessary. The purpose of this paper is to highlight weaknesses in how the IASB and FASB developed their leases Standards, and why those Standards are not robust enough to cope with a shock to the economic system. Design/methodology/approach The COVID-19 relief suspends some features of the leasing requirements rather than changing them. What if other economic or regulatory events cause the same circumstances to arise? Findings Have COVID-19 exposed weaknesses in the leasing standards that should have been avoided when they were developed or is COVID-19 the problem? Originality/value Analysis of actual board discussions and staff papers is unusual and provides insights into the standard-setting process.

The IPSASB's recent strategies: opportunities for academics and standard-setters

2020 ◽  
Vol 32 (3) ◽  
pp. 315-319 ◽  
Author(s):  
Gwenda Jensen
Keyword(s):  
Public Sector ◽  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Fitness For Purpose ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Public Sector Accounting ◽  
Ongoing Dialogue ◽  
Practical Implications

PurposeThe purpose of this article is to contribute to an ongoing dialogue between practitioners and academics. This article describes the International Public Sector Accounting Standards Board (IPSASB) recent strategies and highlights the IPSASB's increasing outreach to academics.Design/methodology/approachThis is a practitioner's viewpoint which reflects the IPSASB's publicly available documents, and the opinions of a practitioner directly involved in the IPSASB's work and International Public Sector Accounting Standards (IPSAS) development.FindingsThe findings are that the IPSASB has increased its outreach to academics and now academics have more opportunities to engage with the IPSASB and IPSAS developments. The IPSASB's strategy has remained relatively constant over time, focusing on IPSAS to address public sector-specific issues, alignment with the International Financial Reporting Standards (IFRS) and reduction of differences between IPSAS and Government Finance Statistics (GFS) reporting guidelines.Research limitations/implicationsThe limitations of this article (which are also its strength in terms of fitness for purpose) are that as a practitioner's viewpoint it provides a brief overview and personal judgments, rather than an empirical analysis of developments applying a theoretical framework.Practical implicationsThe practical implications were IPSASB's increased outreach to the research community providing opportunities for academics to have increased input into IPSAS development, with likely benefits to researchers and the IPSASB.Social implicationsPractitioners’ engagement with academics supports increased understanding of the respective views leading to better outcomes for practitioners and academics working in the area of public sector financial reporting and its regulation.Originality/valueThis article is the first to (a) describe the IPSASB's increasing outreach to academics during 2019–2020 and (b) compare the IPSASB's strategies for the period of 2019–2023, with its strategies since the beginning of IPSAS developments in 1996–1997.

Using arguments and myths to lobby over controversial accounting issues: evidence from Japan

2020 ◽  
Vol 32 (3) ◽  
pp. 355-390
Author(s):  
Noriyuki Tsunogaya ◽  
Andreas Hellmann
Keyword(s):  
Financial Reporting ◽  
Financial Services ◽  
Accounting Standards ◽  
Fair Value ◽  
Network Effect ◽  
International Accounting Standards ◽  
Content Type ◽  
Generally Accepted Accounting Principles ◽  
Financial Reporting Standards ◽  
Stakeholder Groups

Purpose This study aims to examine the (overt) arguments and (covert) myths the Business Accounting Council (BAC) members have used to lobby over controversial accounting issues, such as the application of fair value accounting (FVA) and the adoption of International Financial Reporting Standards (IFRS) in Japan. Design/methodology/approach The authors used a content analysis to examine 85 statements included in multiperiod BAC meeting minutes and 68 articles prepared by International Accounting Standards Board (IASB) representatives from Japan. Findings The results reveal that together with the arguments, myths were created and amplified by opponents of FVA and the Financial Services Agency to hide the latter’s strong regulatory power. They created these myths, using covert stories of the importance of manufacturing activities and tax accounting (for small- and medium-sized enterprises [SMEs]), to oppose mandatory IFRS adoption in Japan and, thus, to maintain vested rights in preparing the Japanese generally accepted accounting principles and Japanese accounting standards for SMEs. Originality/value First, this study contributes to the lobbying literature by focusing on the coalition (network) effect of influential stakeholder groups. Second, although lobbying activities have been investigated mostly using comment letters, this study reviews multiperiod BAC meeting minutes and articles prepared by IASB representatives from Japan. Third, the study examines both overt arguments and covert myths, both of which are important in unmasking the fundamental structures of power within influential organizations, such as government agencies and standard-setters.

Intertwined institutionalization: pressures on Vietnam’s accounting profession during transition to IFRS

2020 ◽  
Vol 32 (4) ◽  
pp. 475-493
Author(s):  
Lan Anh Nguyen ◽  
Gillian Vesty ◽  
Michael Kend ◽  
Quan Nguyen ◽  
Brendan O'Connell
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Future Research ◽  
Accounting System ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Stakeholder Groups ◽  
Organizational Controls ◽  
System Transition ◽  
Monitoring Process

Purpose The purpose of this paper is to understand the institutionally driven changes impacting organizational accounting manipulation in Vietnam’s emerging transitional economy. Specifically, this study explore how Vietnamese accountants and regulators explain questionable accounting transactions and their rationalization for those practices, especially during the period of accounting system transition from Vietnamese accounting standards to International Financial Reporting Standards (IFRS). Design/methodology/approach The study uses interview-based methods involving 22 Vietnamese accountants, financial managers, audit partners and regulators. Findings This study have found dysfunctional approaches to revenue and expense recognition underpinned by institutional theory. At play is a combination of opportunities relating to weak accounting standards and organizational controls; management pressure; and a desire to avoid unwanted scrutiny from Vietnamese regulators. Research limitations/implications This study does not include the views of non-financial managers or other accounting users. Future research could focus more on the perceptions of these other stakeholder groups. Practical implications Accounting manipulation can be collusive, therefore, regulators should have a stricter view and broader examination in the monitoring process. Originality/value This study examine accounting manipulation through the lens of New Institutional Sociology and also share the views of the accountants and regulators. This study argue that weak accounting standards are not the only factors contributing to accounting manipulation. When evaluating the existence of accounting manipulation, this paper find a combination of factors including: opportunities for manipulation, pressure from management and the rationale behind the conduct. These factors should be interpreted in context.

An investigation of the level of compliance with international accounting standards (IAS 1) by listed firms in Bahrain Bourse

2016 ◽  
Vol 9 (2) ◽  
pp. 254-276 ◽  
Author(s):  
Fatema Ebrahim Alrawahi ◽  
Adel Mohammed Sarea
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Annual Reports ◽  
International Accounting ◽  
International Accounting Standards ◽  
Content Type ◽  
Listed Firms ◽  
Financial Reporting Standards ◽  
Industry Type ◽  
Regulatory Bodies

Purpose This study aims to investigate the association between seven firm-specific characteristics and the level of mandatory compliance with International Accounting Standards (IAS) 1 by firms listed on Bahrain Bourse. Design/methodology/approach A disclosure index is used to measure the extent of compliance with IAS 1. Each of the 36 sampled firms’ annual reports were examined against the index for the financial year ending December 31, 2013. Findings The results reveal an overall compliance of 83 per cent. Regression results report that only audit firm size, profitability and industry type have a positive and significant association with IAS 1 disclosure requirements. Practical implications This study should be particularly relevant to regulatory bodies in Bahrain for strategizing and encouraging compliance with IAS 1 by listed firms. Originality/value Additionally, the study contributes to financial reporting literature relating to the Gulf Cooperation Council countries, mainly Bahrain. Bahrain is a financial hub, and it is interesting to examine how it presents its financial statements to investors and the degree of its compliance with International Financial Reporting Standards since its adoption in 2007.

Factors that influenced the adoption of IFRS by Islamic banks in the UAE

2020 ◽  
Vol 33 (1) ◽  
pp. 75-91 ◽  
Author(s):  
Mohammad Haroun Sharairi
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Adoption Process ◽  
Islamic Banking ◽  
Reporting Standards ◽  
Islamic Banks ◽  
Content Type ◽  
Financial Reporting Standards ◽  
The Relationship

Purpose This paper aims to investigate the factors that influenced the current adoption of the international financial reporting standards (IFRS) by Islamic banks in the UAE. This paper examined the relationship between the theoretical aspects and practical components of the research investigation regarding the factors that influence the adoption of IFRS. This paper will contribute to the existing knowledge and practices in not only Islamic countries but also Western countries in terms of a deeper understanding of the adoption of IFRS by the Islamic banks and how the factors could influence the Islamic banking adoption, process, activities and financial reporting. Design/methodology/approach Several theories of regulation were considered in this paper to explain the existence of Islamic accounting regulations and understand why some of the Islamic accounting prescriptions became formal regulations, while others did not. Data was collected for this purpose by conducting a survey with professionals and managers of four Islamic banks in the UAE. Findings This paper revealed that factors, such as religion, culture and local investors, may have limited influence on the current adoption of accounting standards in the Islamic banks. Furthermore, this paper uncovered a concern among respondents of issues that developed when Islamic banks commenced the adoption of IFRS. This paper also indicated that respondents’ opinion does not reflect a perception that all IFRS are suitable for the application of Shariah transactions. Originality/value This study is unique as no study has yet explored the factors that influenced the adoption of the IFRS by Islamic banks in the UAE.

scholarly journals THE IMPORTANCE OF THE CONVERGENCE OF INTERNATIONAL ACCOUNTING STANDARDS TO THE NATIONAL ACCOUNTING SYSTEM OF UZBEKISTAN

World Science ◽  
2019 ◽  
Vol 2 (1(41)) ◽  
pp. 19-22
Author(s):  
Ergasheva Shahlo Turgunovna ◽  
Shermatov Behzod Xalimkul
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Stock Exchanges ◽  
Accounting System ◽  
International Accounting Standards ◽  
Accounting Systems ◽  
Foreign Investors ◽  
National Accounting ◽  
Financial Reporting Standards ◽  
Speed Up

The actuality of the research:-Economic integration-Comparability & uniformity of financial statements-Attracting potential foreign investors.-The requirement of the world financial markets & stock exchanges. -The decreasing of costs of learning local standards.-The aim of research are:-Carrying out the improvement of our accounting systems to speed up the development of our country with the help of foreign investors’ capital.Developing our national accounting standards based on international financial reporting standards and to reveal the problems associated with this.

China's Progress with IFRS Convergence: Interviews with Chinese Professors

2013 ◽  
Vol 28 (2) ◽  
pp. 277-290 ◽  
Author(s):  
Ping Nie ◽  
Allison B. Collins ◽  
Shanping Wang
Keyword(s):  
Financial Reporting ◽  
Accounting Standards ◽  
Training And Development ◽  
Accounting Education ◽  
Accounting System ◽  
International Accounting Standards ◽  
Financial Reporting Standards ◽  
Accounting History ◽  
Convergence Process ◽  
Insight Into

ABSTRACT: The focus of this paper is to examine China's process of convergence with international accounting standards, through a review of the history and through the experiences of its accounting academics. The review of China's accounting history establishes a framework for understanding the current standards. The experiences of Chinese academics during the convergence process are of particular interest to other academics, and offer insight into the training and development of an internationalized accounting profession. To gain insights from the Chinese academics, we conducted interviews with ten professors, and solicited comments, suggestions, and advice from these academics. These academics report between 6 to 50 years of experience in Chinese accounting education. The focus of our interviews was to gain an understanding of the forces and circumstances that characterized the period during which China changed from an internal, rules-based accounting system to a system that has now achieved significant progress toward convergence with the International Financial Reporting Standards (IFRS). The insights from these Chinese accounting professors will be of interest to educators in other countries that are dealing with IFRS-related issues in their curriculum.

Audit effort, materiality and audit fees: evidence from the adoption of IFRS in Australia

2020 ◽  
Vol 33 (1) ◽  
pp. 186-216 ◽  
Author(s):  
Muhammad Shahin Miah ◽  
Haiyan Jiang ◽  
Asheq Rahman ◽  
Warwick Stent
Keyword(s):  
Financial Reporting ◽  
Design Methodology ◽  
Accounting Standards ◽  
Positive Association ◽  
Financial Statements ◽  
Audit Fees ◽  
Content Type ◽  
Risk Levels ◽  
Financial Reporting Standards ◽  
Different Levels

Purpose This paper aims to investigate the association between International Financial Reporting Standards (IFRS) effort due to higher levels of material adjustments and audit fees. In addition, this paper tests whether these associations differ between industry specialist auditors and non-specialist auditors. Design/methodology/approach The authors measure IFRS effort by using differences between local GAAP and IFRS. More specifically, they measure the differences in the balances of accounts that are prepared under IFRS as opposed to the previously used Australian Accounting Standards Board (AASB) standards. They posit that higher material adjustments and more risk to fair presentation of financial statements require additional accounting and auditing effort (“IFRS effort”). Findings The authors find that audit fees are higher when accounting standards are more material and complex at an aggregate level. Nevertheless, not all standards are equally complex and/or material and not all individual standards contribute to higher audit fees. In addition, the results show that the positive association between IFRS effort and audit fees is more pronounced when firms are audited by city-level industry specialists than by non-industry specialists. Originality/value Overall, the results are consistent with the prediction of increasing audit fees for firms requiring higher levels of IFRS effort compared to firms requiring lower levels of IFRS effort. The results contribute to the understanding that not all IFRS are equally complex and, thereby, the standards require different levels of auditor effort. Isolating specific standards based on materiality/risk levels is informative to standard setters for standard setting, standard implementation and post-implementation review of standards.

Real options, enforcement of goodwill/intangibles rules, and associated behavioural issues

2015 ◽  
Vol 18 (3) ◽  
pp. 330-351 ◽  
Author(s):  
Mike Nwogugu
Keyword(s):  
Real Options ◽  
Financial Reporting ◽  
Accounting Standards ◽  
Financial Accounting ◽  
International Accounting Standards ◽  
Financial Accounting Standards Board ◽  
Content Type ◽  
Financial Reporting Standards ◽  
Real Options Approach ◽  
Selection Of

Purpose – The purpose of this paper is to introduce new economic psychology theories that can explain fraud, misconduct and non-compliance that may arise from the implementation and enforcement of accounting standards codification (ASC) 805/350, international financial reporting standards (IFRS) 3R and IAS-38. Design/methodology/approach – The approach is entirely theoretical. The paper analyzes existing theories about real options and enforcement of regulations/statutes, and introduces new psychological biases that can arise. Findings – The real options approach suggested for handling the enforcement of goodwill/intangibles regulations is not effective. Research limitations/implications – The research is limited to international accounting standards board (IASB)/IFRS and financial accounting standards board (FASB) accounting standards. Originality/value – The critiques and theories developed in the paper can be used in the analysis of selection of disputes for litigation, anti-corruption programs and regulation of transactions that are susceptible to fraud.

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