International Journal of Finance & Managerial Accounting

International Journal of Finance & Managerial Accounting

A Review Of International Financial Reporting Standards In Iran And Its Effect On The Quality Of Accounting Financial Statements

Document Type : Original Article

Authors
mohamad ahadzadeh 1
mohamadreza vakilifard 2
1 Master's student of financial management, Islamic Azad University, Science and Research branch, Tehran, Iran
2 Master’s degree of Business Administration, Islamic Azad University, North Tehran Branch, Tehran, Iran
10.30495/ijfma.2023.73601.2020
Abstract
The main purpose of this research is to review the international financial reporting standards and its effect on the quality of presentation of financial accounting statements. In fact, this standard is a set of accounting standards compiled by the International Accounting Standards Board (IASB) and the purpose of these standards is to prepare the statements of financial companies in the form of a global standard. In this regard, in the present study, the impact of this standard on the quality of financial statements is investigated. The established standards include common rules and procedures that provide transparency, unification of financial statements presented, comprehensibility and reliability of financial statements worldwide. In fact, these standards specify how companies should maintain and report their accounts. The statistical population of the research includes 96 financial managers in 2023 who are responsible for preparing financial statements, whose opinions about the impact of adopting the IFRS standard have been collected in the form of a questionnaire. In order to analyze the collected data, structural equation modeling and path analysis using PLS software were used. The current research is descriptive - analytical and data collection was done through library studies and questionnaires. The variables of the research are: relevance, transparency, comprehensibility, reliability and comparability of the presented financial statements. Finally, according to the investigations, the research results indicate that there is a positive and significant relationship between the presentation of financial statements in a common format with its relevance, transparency, reliability, comparability and comprehensibility.
Keywords
IFRS standard
quality of presentation of financial statements
uniformity
comprehensibility
reliability
1- Shruti, R., & Thenmozhi, M. (2023). Founder ownership and value relevance of IFRS convergence: Role of institutional investors. Pacific-Basin Finance Journal, 79, 101989. https://doi.org/10.1016/j.pacfin.2023.101989.
2- Hamdem, hadi. Zinali, Mehdi. Badavar Nahandi, Yunus. Mohammadi, Ahmed (2022). Identifying the components and factors affecting the transfer of IFRS knowledge with an emphasis on knowledge, that knowledge and the organizational distance between them with the subject analysis method. Journal of accounting and auditing studies.
 
3- Wakil, G., & Petruska, K. A. (2022). Does mandatory IFRS adoption affect large and small public firms' accounting quality differently? Evidence from Canada. Advances in accounting, 57, 100598. https://doi.org/10.1016/j.adiac.2022.100598.
 
4- Hamdem, hadi. Zinali, Mehdi. Badavar Nahandi, Yunus. Mohammadi, Ahmed (2021). Identifying and ranking the background and knowledge factors affecting the transfer of knowledge of international financial reporting standards with the approach of international business development. Scientific Research Journal of International Business Management. Volume 4, Number: 4 - Serial Number: 16. Page: 89-109.
 
5- Heydari, Mohammad. Taherabadi, Ali Asghar. Jamshidi Navid, Babak. Qanbari, Mehrdad (2021). The influence of the economic, social and cultural environment of countries on the adoption of international financial reporting standards. Journal of accounting and auditing research. Volume: 13, Number 50.
 
6- Bahramian, Amirhossein. Ranjbar, Mohammad Hossein. Ahmadi, Faiq. Abedini, Bijan (2021). Future study of the auditing profession with an emphasis on IFRS requirements and business cycles. Journal of accounting and auditing research. Volume: 13, Number 49. Page: 133-154.
 
7- Adhikari, A., Bansal, M., & Kumar, A. (2021). IFRS convergence and accounting quality: India a case study. Journal of International Accounting, Auditing and Taxation, 45, 100430. https://doi.org/10.1016/j.intaccaudtax.2021.100430.
8- Guo, L., & Platikanov, S. (2019). Institutional ownership and corporate governance of public companies in China. Pacific-Basin Finance Journal, 57, 101180. DOI: 10.1016/j.pacfin.2019.101180.
9- Rafiyan, Mohsen (2019). Investigating the approach of the Australian Accounting Standards Board in the field of implementing international public sector accounting standards. Journal of accounting and budgeting of the public sector. Series: 2. Pages: 64 - 71.
10- Kavrazian, Neda. Sheikh, Mohammad Javad. Abbasi, Reza (2018). The consequences of risk related to international financial reporting standards in Iranian banks admitted to the stock exchange. Journal of accounting and auditing research. Volume 11, number 43, serial number 43. Pages 151-170.
11-  Persakis, A., & Iatridis, G. E. (2017). The joint effect of investor protection, IFRS and earnings quality on cost of capital: An international study. Journal of International Financial Markets, Institutions and Money, 46, 1-29. https://doi.org/10.1016/j.intfin.2016.10.001.
12- Mbawuni, J. (2018). Perceived Benefits and Challeges of IFRS Adoption in Ghana: Views of Members of Institute of Chartered Accountants, Ghana (ICAG). International Journal of Financial Research, 9(1), 99-114. DOI: 10.5430/ijfr.v9n1p99.
13- Jindrichovska, I., & Kubickova, D. (2017). The role and current status of IFRS in the completion of national accounting rules–Evidence from the Czech Republic. Accounting in Europe, 14(1-2), 56-66. https://doi.org/10.1080/17449480.2017.1301671.
14- Muniandy, P., Tanewski, G., & Johl, S. K. (2016). Institutional investors in Australia: do they play a homogenous monitoring role?. Pacific-Basin Finance Journal, 40, 266-288.
DOI: 10.1016/j.pacfin.2016.01.001.
15- Giner, B., Hellman, N., Jorissen, A., Quagli, A., & Taleb, A. (2016). On the ‘Review of Structure and Effectiveness of the IFRS Foundation’: the EAA’s Financial Reporting Standards Committee’s View. Accounting in Europe, 13(2), 285-294.
https://doi.org/10.1080/17449480.2016.1205205.
16- Wang, J. W., & Yu, W. W. (2015). The information content of stock prices, legal environments, and accounting standards: International evidence. European Accounting Review, 24(3), 471-493. https://doi.org/10.1080/09638180.2014.977802.
17- Gracia-García, P., De-La-Cámara, C., Santabárbara, J., Lopez-Anton, R., Quintanilla, M. A., Ventura, T., ... & Lobo, A. (2015). Depression and incident Alzheimer disease: the impact of disease severity. The American Journal of Geriatric Psychiatry, 23(2), 119-129.
DOI: 10.1016/j.jagp.2013.02.011.
18- Brown, P., Preiato, J., & Tarca, A. (2014). Measuring country differences in enforcement of accounting standards: An audit and enforcement proxy. Journal of Business Finance & Accounting, 41(1-2), 1-52. https://doi.org/10.1111/jbfa.12066.
19- Christensen, H. B., Hail, L., & Leuz, C. (2013). Mandatory IFRS reporting and changes in enforcement. Journal of accounting and economics, 56(2-3), 147-177. https://doi.org/10.1016/j.jacceco.2013.10.007.
20- Nobes, C. (2013). The continued survival of international differences under IFRS. Accounting and business research, 43(2), 83-111. https://doi.org/10.1080/00014788.2013.770644.
21- Jarva, H., & Lantto, A. M. (2012). Information content of IFRS versus domestic accounting standards: evidence from Finland. The Finnish Journal of Business Economics, (2), 141-177. http://dx.doi.org/10.2139/ssrn.1588087.
22- Yip, R. W., & Young, D. (2012). Does mandatory IFRS adoption improve information comparability?. The Accounting Review, 87(5), 1767-1789.
DOI: 10.2308/ackr-50192.
23- Tsalavoutas, I., André, P., & Evans, L. (2012). The transition to IFRS and the value relevance of financial statements in Greece. The British Accounting Review, 44(4), 262-277. https://doi.org/10.1016/j.bar.2012.09.004.
24- Cole, V., Branson, J., & Breesch, D. (2011). Determinants influencing the de facto comparability of European IFRS financial statements. Available at SSRN 1967001. http://dx.doi.org/10.2139/ssrn.1967001.
25- Hope, O. K. (2007). Discussion of “Attribute differences between US GAAP and IFRS earnings: An exploratory study”. The International Journal of Accounting, 42(2), 143-147.
26- Ball, R., Kothari, S. P., & Robin, A. (2000). The effect of international institutional factors on properties of accounting earnings. Journal of accounting and economics, 29(1), 1-51. https://doi.org/10.1016/S0165-4101(00)00012-4.
27- Hope, O. K. (2003). Disclosure practices, enforcement of accounting standards, and analysts' forecast accuracy: An international study. Journal of accounting research, 41(2), 235-272. DOI:10.1111/1475-679X.00102.
28- Ashbaugh, H., & Pincus, M. (2001). Domestic accounting standards, international accounting standards, and the predictability of earnings. Journal of accounting research, 39(3), 417-434. https://doi.org/10.1111/1475-679X.00020.
29- Ball, R., Robin, A., & Wu, J. S. (2003). Incentives versus standards: properties of accounting income in four East Asian countries. Journal of accounting and economics, 36(1-3),235-270. https://doi.org/10.1016/j.jacceco.2003.10.003.
30- Ashbaugh, H., & Pincus, M. (2001). Domestic accounting standards, international accounting standards, and the predictability of earnings. Journal of accounting research, 39(3), 417-434. https://doi.org/10.1111/1475-679X.00020.
31- www.IFRS.org.