Preliminary Insights on the Adoption of International Financial Reporting Standard (IFRS) for Small and Medium Enterprises (SMEs) in Pakistan

This study aims to investigate the perceptions of accountants regarding the possible adoption of International Financial Reporting Standards (IFRS) for SMEs in Pakistan. IFRS for SMEs were issued by the IASB in 2009. The adoption of the IFRS for SMEs in Pakistan has been proposed by the Institute of Chartered Accountants of Pakistan (ICAP) and in 2015 the Securities and Exchange Commission of Pakistan (SECP) has approved the adoption of the 'International Financial Reporting Standard for Small and Medium Sized Entities. We conducted seven semi-structured interviews with the chartered accountants based in Multan that were providing accounting and consultancy services to various SMEs. The findings of the research confirmed the reasonable level of awareness among chartered accountants regarding IFRS for SME. Our respondents perceive high-quality comparable financial information as the most significant advantage of applying IFRS for SMEs whereas cost burdens on firms and lack of trained personnel were perceived as major obstacles for the adoption decision. The findings also suggest that diligent IFRS awareness and training programs must be organized by all regulatory and professional bodies (like SECP and ICAP) on both country and firm level to achieve the true purpose of this adoption.

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INTERNATIONAL FINANCIAL REPORTING STANDARDS FOR SMALL AND MEDIUM ENTERPRISE (IFRS FOR SMES) AND THE STATEMENT OF ACCOUNTING STANDARDS (SAS): A COMPARATIVE STUDY

International Journal of Finance and Accounting ◽

10.47604/ijfa.211 ◽

2016 ◽

Vol 1 (3) ◽

pp. 79

Author(s):

Muotolu Peace Chikwemma ◽

Egungwu Ngozi Ursula ◽

Anichebe Alphonsus Sunday

Keyword(s):

Financial Reporting ◽

Small Firms ◽

Small And Medium Enterprises ◽

Accounting Standards ◽

Reporting Standard ◽

International Financial Reporting Standard ◽

Financial Reporting Standards ◽

Entrepreneurial Spirit ◽

Medium Enterprise ◽

Medium Enterprises

Purpose: Micro, small and medium-sized enterprises (SME) are the engines that propel the world economy; they are essential sources of jobs, they create entrepreneurial spirit and innovation in the economy and are thus crucial for fostering competitiveness and creativity. The objective of this study therefore, is to ascertain the need for International Financial Reporting Standard for Small and Medium Enterprises (IFRS for SMEs) instead of Statement of Accounting Standards (SAS), to ascertain the extent to which IFRS aids managements in attaining goals and objectives as well as improving its market share and to ascertain the challenges for Non-compliance (causes and penalties) with international financial reporting standard for Small and Medium Enterprises.Methodology: Analysis of variance (ANOVA) was used to test hypothesis.Results: The findings were; a major factor why IFRS is adopted by Nigeria is because other countries have adopted it, the size of entities to participate in IFRS for SMES varies, adopting a globally accepted financial reporting is relevant to small firms as they operate in a globalized world.Policy recommendation: This study recommends that the IASB should ensure full implementation/compliance of IFRS for SME by companies that fall under that category, the cost of acquiring IFRS education should also be subsidized for small firms by major accounting regulatory bodies in Nigeria.

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Accounting Standards and Earnings Quality — Evidence from Registered ADRs

Review of Pacific Basin Financial Markets and Policies ◽

10.1142/s0219091518500224 ◽

2018 ◽

Vol 21 (04) ◽

pp. 1850022

Author(s):

Yaseen S. Alhaj-Yaseen ◽

Kean Wu ◽

Leslie B. Fletcher

Keyword(s):

Financial Reporting ◽

Earnings Quality ◽

Accounting Standards ◽

Securities And Exchange Commission ◽

High Quality ◽

Reporting Standard ◽

International Financial Reporting Standard ◽

The Us ◽

Us Gaap

This paper examines the changes in earnings quality of registered American Depositary Receipts (ADRs) as a result of switching accounting standards. We aim to shed light on the potential impact of International Financial Reporting Standard (IFRS) adoption on US firms. A suboptimal approach to achieve this goal is through examination of US firms’ surrogates such as ADRs. Unlike previous studies, we made a distinction between registered and unregistered ADRs and affirmed that registered ADRs are the closest surrogates with which to conduct our analysis because they are exclusively required to adhere to the Securities and Exchange Commission (SEC)’s stringent disclosure requirements. When cross-listing their equity on the US exchanges, foreign issuers can file their financial reports with the SEC using IFRS, US GAAP (generally accepted accounting principles), or their domestic GAAP with reconciliation to US GAAP. An improvement in earnings quality is documented when ADRs adopt US GAAP or IFRS versus domestic GAAP. However, when the comparison is made between US GAAP and IFRS, no difference in earnings quality is documented. These results indicate that switching to high-quality accounting standards is likely to improve earnings quality. This improvement is maximized when the difference between reporting standards is high and minimized if otherwise. Our conclusion is that the adoption of IFRS in the US is unlikely to change earnings quality of local issuers. Moreover, we drew a distinction between reconciliation with and adoption of high-quality accountings standards and find that while the former can enhance earnings quality, the latter can further improve it.

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Financial reporting by Small and Medium sized Entities in Mongolia and the International Financial Reporting Standard for Small and Medium sized Entities

10.26686/wgtn.17142971.v1 ◽

2021 ◽

Author(s):

◽

Uyanga Jadamba

Keyword(s):

Financial Reporting ◽

Ordinary Least Squares ◽

Survey Questionnaire ◽

Structured Interviews ◽

Reporting Standard ◽

International Financial Reporting Standard ◽

Reporting Practices ◽

Low Level ◽

Reporting Practice ◽

Accounting Practitioners

<p>This study examines three important aspects of financial reporting practice of Small and Medium sized Entities (SMEs) in developing economy. First, the study investigates the existing reporting practices of SMEs in Mongolia. Second, the study considers the expected impact for Mongolian SMEs of adopting the International Financial Reporting Standard for Small and Medium sized Entities (IFRS for SMEs). Third, the study examines the relationships between the economic characteristics of SMEs and both their reporting practice and the expected impact of adoption of the IFRS for SMEs. The study adopts a mixed method approach with a quantitative survey questionnaire and qualitative semi-structured interviews. The study developed a survey questionnaire and obtained 102 responses: 67 responses from employee account preparers of SMEs and 35 responses from accounting practitioners of Public Accounting Firms (PAFs) engaged with SMEs. The results of the survey were analysed using a range of non-parametric tests and Ordinary Least Squares (OLS). The qualitative semi-structured interviews were carried out with eight standard-setters, educators and information users and analysed using Nvivo. Overall, the research findings suggest that in Mongolia there is a low level of compliance with international financial reporting standards. It appears that preparers and users perceive a low level of net benefits from compliance. Surprisingly, the results indicate that the economic characteristics of SMEs do not appear to influence their reporting practice. Adoption of the IFRS for SMEs is expected to increase the level of compliance by SMEs.</p>

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Voluntary coercion? Conditions for sustainable reporting by small and medium-sized enterprises

Zeszyty Teoretyczne Rachunkowości ◽

10.5604/01.3001.0015.5744 ◽

2021 ◽

Vol 45 (4) ◽

pp. 91-110

Author(s):

Przemysław Mućko ◽

Andrzej Niemiec ◽

Wanda Skoczylas

Keyword(s):

Financial Reporting ◽

Value Chain ◽

Small And Medium Enterprises ◽

Corporate Sustainability ◽

Sustainability Reporting ◽

Financial Information ◽

Reporting Standard ◽

Information Research ◽

The One ◽

Medium Enterprises

Purpose: The purpose of this paper is to identify the determinants and possibilities of dis-seminating sustainability reporting among small and medium-sized enterprises (SMEs) on the basis of the accounting theory, legal regulations, and the opinions of SME representa-tives. Methodology/approach: A review of the literature and other sources. Cluster analysis, the k-means method, and the one-way ANOVA test were used to prepare the results of the survey conducted through AAP. Findings: Only stakeholder theory provides explanations that are useful for identifying the determinants of the dissemination of sustainability reporting among SMEs. The major-ity of SMEs are indirectly obliged to report, as a result of maintaining relationships with entities that are required to report non-financial information on the entire value chain. In our survey, we identified two groups. The first represents skeptics. They do not report non-financial information and do not support the introduction of a single, simplified, EU sus-tainability reporting standard for SMEs. The second group believes that SMEs should report non-financial data. They are usually entities that already report such information. Research limitations/implications: The limitations of the study are due to sample se-lection and size. In the implications, we emphasized the advantages of indirectly obliging SMEs to report non-financial information by requiring that their key stakeholders collect such information. Originality/value: The article fills a gap in the literature by providing empirical research on non-financial reporting in SMEs. Keywords: non-financial reporting, corporate sustainability reporting, small and medium enterprises.

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The Impact of Malaysian Private Entity Reporting Standard (MPERS) Adoption on the Value Relevance and Timeliness of Financial Reporting by Small and Medium Enterprises (Smes): A Conceptual Framework

International Journal of Academic Research in Accounting Finance and Management Sciences ◽

10.6007/ijarafms/v11-i3/10613 ◽

2021 ◽

Vol 11 (3) ◽

Author(s):

Siti Nur Ayuni Rosli ◽

Nurul Nazlia Jamil

Keyword(s):

Conceptual Framework ◽

Financial Reporting ◽

Value Relevance ◽

Small And Medium Enterprises ◽

Reporting Standard ◽

Private Entity ◽

Medium Enterprises ◽

The Impact

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Financial reporting by Small and Medium sized Entities in Mongolia and the International Financial Reporting Standard for Small and Medium sized Entities

10.26686/wgtn.17142971 ◽

2021 ◽

Author(s):

◽

Uyanga Jadamba

Keyword(s):

Financial Reporting ◽

Ordinary Least Squares ◽

Survey Questionnaire ◽

Structured Interviews ◽

Reporting Standard ◽

International Financial Reporting Standard ◽

Reporting Practices ◽

Low Level ◽

Reporting Practice ◽

Accounting Practitioners

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Compliance Factors of Malaysian Private Entity Reporting Standard (MPERS) by Small Medium Enterprises (SMEs)

International Journal of Financial Research ◽

10.5430/ijfr.v12n3p149 ◽

2021 ◽

Vol 12 (3) ◽

pp. 149

Author(s):

Nurul Nazlia Jamil ◽

Nathasa Mazna Ramli ◽

Ainulashikin Marzuki ◽

Nurul Nadiah Ahmad

Keyword(s):

Financial Reporting ◽

Questionnaire Survey ◽

Small And Medium Enterprises ◽

Local Context ◽

Reporting Standard ◽

Factors Affecting ◽

Reporting Practices ◽

Private Entity ◽

Small Medium Enterprises ◽

Medium Enterprises

The study objectively reports the findings on a questionnaire survey when examining the factors affecting Malaysian Private Entity Reporting Standard (MPERS) compliance in Malaysia by small and medium enterprises (SMEs). The study is based on a professional accountant questionnaire survey involving a sample of 176 respondents who are currently involved in the implementation of MPERS. The result reveals that the main factors affecting the SMEs' compliance with MPERS were the legal limitations and requirements. The study also finds that the perception, size of entities, management and accounting skills of the external user, and consideration of costs and benefits, have little impact on MPERS compliance. Furthermore, the study contributes to the literature of the financial reporting standard for SMEs by providing empirical from Malaysia's local context that uses MPERS and how the theses affect reporting practices. To adopt the 'true and fair view' financial reporting standard when explaining the firm's financial performance and financial position, this study should be the interest of regulatory authority, standard setters, and owners of SMEs themselves.

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Factors Affecting the Adoption of Financial Reporting Standards by Micro, Small and Medium Enterprises in Tanzania: The Case of Mbeya City Council

East African Journal of Business and Economics ◽

10.37284/eajbe.4.1.480 ◽

2021 ◽

Vol 4 (1) ◽

pp. 46-61

Author(s):

Benance Lackson ◽

Seif Muba

Keyword(s):

Financial Reporting ◽

Small And Medium Enterprises ◽

City Council ◽

Primary Data ◽

Reporting Standards ◽

Chi Square ◽

Reporting Standard ◽

Financial Reporting Standards ◽

The Government ◽

Medium Enterprises

Different studies have revealed that the majority of the micro, small and medium enterprises (MSMEs) in Tanzania do not use basic accounting principles and practices which are consistent with financial reporting standards in managing business though Tanzania adopted International Financial Reporting Standards for small and medium enterprises (IFRS for SMEs) in 2009 and issued financial reporting standard for Micro entities in 2018. This shows that the level of adoption and applicability of the standards is very low. Therefore, this study was carried out to assess factors that affect the adoption of financial reporting standards by MSMEs in Tanzania. The study was conducted in Mbeya City Council where primary data was collected from a sample size of 245 respondents via a Likert scale questionnaire. The descripto-explanatory research design was employed where the results were quantitatively analysed through descriptive statistics and chi-square (x2) model hypothesis testing. The results show that non-adoption of the standards was the result of inadequate knowledge by MSMEs, lack of awareness by most MSMEs on the existence of the standards, high perceived cost of conversion and implementation, weak legal and regulatory enforcement strategy, low level of technology applicability by SMEs and complexity of the standards as it needs a well-trained accountant to implement. The study recommends the government to come up with the implementation strategy that will first ensure that a large number of MSMEs is well trained on financial reporting standards because the decision to adopt or not to adopt largely depend on the adequacy of knowledge.

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Perceived Benefits and Challeges of IFRS Adoption in Ghana: Views of Members of Institute of Chartered Accountants, Ghana (ICAG)

International Journal of Financial Research ◽

10.5430/ijfr.v9n1p99 ◽

2017 ◽

Vol 9 (1) ◽

pp. 99

Author(s):

Joseph Mbawuni

Keyword(s):

Cross Section ◽

Financial Reporting ◽

Perceived Benefits ◽

Reporting Standard ◽

International Financial Reporting Standard ◽

Ifrs Adoption ◽

Body Of Knowledge ◽

Managerial Implications ◽

Sub Saharan ◽

Chartered Accountants

This paper provides an empirical evidence regarding the perceived benefits and challenges of International Financial Reporting Standard (IFRS) adoption in Ghana. It draws on rich body of knowledge in IFRS from both developed and developing countries to develop a conceptual framework for the perceived benefits and challenges that come with IFRS adoption. It used data from a cross-section of 762 members of the Institute of Charted Accountants, Ghana. This study found that a number of perceived benefits and challenges with the adoption of IFRS in Ghana, notable among the benefits was the ease of comparability of financial data across borders, and the top-most challenge was the continuous amendments to IFRS. There were few differences in evaluation between old and young accountants among the respondents. The theoretical and managerial implications are discussed. This study contributes to the limited empirical research regarding the perceived benefits and challenges of IFRS adoption in Sub-Saharan African in general and Ghana in particular.

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The Adoption of Financial Accounting Standards for Small Medium Enterprises by Muslim Entrepreneurs

JABM JOURNAL of ACCOUNTING - BUSINESS & MANAGEMENT ◽

10.31966/jabminternational.v27i2.692 ◽

2020 ◽

Vol 27 (2) ◽

pp. 54

Author(s):

Muslichah Muslichah ◽

Sunarto Sunarto ◽

Anang Amir Kusnanto ◽

Sri Indrawati ◽

Hariyanto Hariyanto

Keyword(s):

Financial Reporting ◽

Quantitative Data ◽

Accounting Standards ◽

Financial Accounting ◽

Unexpected Finding ◽

Financial Reports ◽

Small Medium Enterprises ◽

Medium Enterprises ◽

Chartered Accountants ◽

Structured Questionnaire

This study aims to discuss the adoption of financial reporting and accounting standards for small-medium enterprises (SMEs) by Muslim entrepreneurs. A structured questionnaire was used to collect quantitative data from the SME owners. 214 Muslim owners of SME businesses participated in the survey. The results show that only a few Muslim entrepreneurs prepared financial reports regularly. The main reason for preparing the statement is for calculating tax, borrowing money, and decision making. An unexpected finding from this study is that most of the Muslim owners are unaware of Standard for SMEs. Users of SME financial reports include tax authority, banks, and owners, or shareholders. This study enriches the financial reporting studies by examining the accounting standards for SMEs in a Muslim dominated country. The findings of this study also have implications for the Institute of Indonesia chartered accountants (IICA) as standard setter. IICA must routinely disseminate these standards to SMEs and also assist them in preparing financial reports

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