Volume 8, Issue 6, December 2019, Page: 86-93
The Possible Challenges of Adoption of International Financial Reporting Standards: A Qualitative Meta-analysis Approach
Abebe Gibru, Department of Accounting and Finance, Debre Markos University, Burie Campus, Burie, Ethiopia
Mezgebu Aynalem, Department of Agri-Business and Value Chain Management, Debre Markos University, Burie Campus, Burie, Ethiopia
Received: Sep. 9, 2019;       Accepted: Oct. 29, 2019;       Published: Jan. 6, 2020
DOI: 10.11648/j.jim.20190806.11      View  285      Downloads  144
Currently, International Financial Reporting Standards (IFRS) have been adopted by over 143 countries all over the world. The aims of this standard is to develop, in the public interest, a single set of high-quality, comprehensible, enforceable and globally accepted financial reporting standards based on clearly expressed principles and legislations. Nevertheless, its adoption procedure creates challenges to the adopter. Thus, the purpose of this study was to investigate the possible challenges of adoption of international financial reporting standards (IFRS). A sample of fifteen studies and articles related to challenge of International Financial Reporting Standards adoption that had been done starting from 2012 were selected from journal articles; Master of Science thesis (MSC) and master of business administration (MBA) thesis, then the collected data were analyzed using qualitative meta- synthesis which is presented using tables and narratives. The study found out that cost of adoption, training of relevant accounting professional, lack of competent man power, lack of proper financial reporting guidance, use of fair value accounting in comparison to historical cost method, Lack of proper instructions from regulatory bodies, increases the risk for handling in interpretation of financial statements and modernized information technology system in handling the transitions to standard were the main challenges of International Financial Reporting Standards adoption.
IFRS, Regulatory Bodies, Challenge of IFRS
To cite this article
Abebe Gibru, Mezgebu Aynalem, The Possible Challenges of Adoption of International Financial Reporting Standards: A Qualitative Meta-analysis Approach, Journal of Investment and Management. Vol. 8, No. 6, 2019, pp. 86-93. doi: 10.11648/j.jim.20190806.11
Copyright © 2019 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Jermakowicz, E. K., Effects of adoption of international financial reporting standards in Belgium: the evidence from BEL-20 companies. Accounting in Europe, 2004. 1 (1): p. 51-70.
Putrayasa, I. B. and A. Susana, Kalimat efektif: (diksi, struktur, dan logika). 2007: Refika Aditama.
Ball, R., A. Robin, and G. Sadka, Are timeliness and conservatism due to debt or equity markets? An international test of “contracting” and “value relevance”. Theories of Accounting. Manuscript, University of Chicago, 2006.
Christensen, H. B., et al., Incentives or standards: What determines accounting quality changes around IFRS adoption? European Accounting Review, 2015. 24 (1): p. 31-61.
Sunder, S., IFRS Monopoly: The Pied Piper of Financial Reporting, being paper prepared for information for better markets conference ICAEW. London December, 2010: p. 20-21.
Armstrong, C. S., et al., Market reaction to the adoption of IFRS in Europe. The accounting review, 2010. 85 (1): p. 31-61.
Covrig, V. M., M. L. Defond, and M. Hung, Home bias, foreign mutual fund holdings, and the voluntary adoption of international accounting standards. Journal of Accounting Research, 2007. 45 (1): p. 41-70.
Daske, H., et al., Adopting a label: Heterogeneity in the economic consequences around IAS/IFRS adoptions. Journal of Accounting Research, 2013. 51 (3): p. 495-547.
Odia, J. and K. Ogiedu, IFRS adoption: Issues, challenges and lessons for Nigeria and other adopters. Mediterranean Journal of Social Sciences, 2013. 4 (3): p. 389.
Gordon, I. M., Lessons to be learned: An examination of Canadian and US financial accounting and auditing textbooks for ethics/governance coverage. Journal of Business Ethics, 2011. 101 (1): p. 29-47.
Baker, C. R. and E. M. Barbu, Trends in research on international accounting harmonization. The International Journal of Accounting, 2007. 42 (3): p. 272-304.
Iyoha, F. and O. S. Faboyede, Adopting International Financial Reporting Standards (IFRS)‐A Focus on Nigeria. International Journal of Research in Commerce and Management, 2011. 2 (1).
Soderstrom, N. S. and K. J. Sun, IFRS adoption and accounting quality: a review. European Accounting Review, 2007. 16 (4): p. 675-702.
Obazee, J., Current Convergence Efforts in Accounting Standard Setting and Financial Reporting: Lagos, Nigerian Accounting Standing Board. January, 2007. 31: p. 17-26.
Hail, L., C. Leuz, and P. D. Wysocki, Global accounting convergence and the potential adoption of IFRS by the United States: An analysis of economic and policy factors. Available at SSRN 1357331, 2009.
Ashbaugh, H. and M. Pincus, Domestic accounting standards, international accounting standards, and the predictability of earnings. Journal of accounting research, 2001. 39 (3): p. 417-434.
Barth, M. E., W. R. Landsman, and M. H. Lang, International accounting standards and accounting quality. Journal of accounting research, 2008. 46 (3): p. 467-498.
Ojeka, S. and D. Mukoro, internationa financial reporting standard (ifrs) and smes in nigeria: perception of academic. International journal of research in commerce & manp., gement, 2011. 2 (1): p. 13-19.
Baiman, S. and R. E. Verrecchia, The relation among capital markets, financial disclosure, production efficiency, and insider trading. Journal of accounting research, 1996. 34 (1): p. 1-22.
Easley, D. and M. O'hara, Information and the cost of capital. The journal of finance, 2004. 59 (4): p. 1553-1583.
Lambert, R., C. Leuz, and R. E. Verrecchia, Accounting information, disclosure, and the cost of capital. Journal of accounting research, 2007. 45 (2): p. 385-420.
Alkali, M. Y. and N. A. Lode, Efforts and Challenges in Adopting International Financial Reporting Standards (IFRS) in Nigeria.
Mbawuni, J., Perceived Benefits and Challeges of IFRS Adoption in Ghana: Views of Members of Institute of Chartered Accountants, Ghana (ICAG). International Journal of Financial Research, 2018. 9 (1): p. 99-114.
Tesfu, F. F., The Adoption of International Financial Reporting Standards (IFRS) in Ethiopia: Benefits and Key Challenges. MSC Research Paper, 2012.
Simegn, Y., Adoption of International Financial Reporting Standards (IFRS) in Ethiopia: Empirical Evidence. The International Journal Research Publication's Research Journal of Economics and Business Studies, 2015. 4 (3).
Zakari, M., Challenges of International Financial Reporting Standards (IFRS) Adoption in Libya. International Journal of Accounting and Financial Reporting, ISSN, 2014: p. 2162-3082.
Alemi, T. D. and J. Pasricha, IFRS Adoption progress in Ethiopia. Research Journal of Finance and Accounting, 2016. 7 (1): p. 69-81.
Abebe, M., The Challenges and Prospects of IFRS Adoption in Ethiopian Commercial Banks. 2018: GRIN Verlag.
Mengesha, S., Adoption and Implementation of International Financial Reporting Standards (IFRS) in Ethiopia. 2016, St. Mary's University.
Lema, E., Benefit and Challenges of adopting IFRS in Case of commercial Bank of Ethiopia Addis Ababa, Ethiopia. 2017, St. Mary's University.
Perera, D., Adoption of international financial reporting standards (IFRS) for small and medium-sized enterprises (SMEs): problems and challenges. 2016.
Hanefah, H. M. M. and J. Singh, Convergence towards IFRS in Malaysia: Issues, challenges and opportunities. International Journal of Business, Economics and Law, 2012. 1 (2): p. 85-91.
Herath, S. K. and F. H. Alsulmi, International Financial Reporting Standards (IFRS): The Benefits, Obstacles, and Opportunities for Implementation in Saudi Arabia. International Journal of Social Science and Business, 2017. 2 (1): p. 1-18.
Sawan, N. and I. Alsaqqa, The advantages and the challenges of adopting IFRS into UAE stock market. International Journal of Business and Management, 2013. 8 (19): p. 1-23.
De George, E. T., X. Li, and L. Shivakumar, A review of the IFRS adoption literature. Review of Accounting Studies, 2016. 21 (3): p. 898-1004.
Aydın, N., Teaching Shakespeare: A qualitative meta-analysis. 2013, Bilkent University.
Viccellio, P., FISCAL IMPACT: Budgeted committee and staff resources.
Browse journals by subject