What drives the comparability effect of mandatory IFRS adoption?

• 成果类型: Article
• 署名作者: Cascino, Stefano; Gassen, Joachim
• 署名单位: University of London; London School Economics & Political Science; Humboldt University of Berlin
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-014-9296-5
• 发表日期: 2015
• 页码: 242-282
• 关键词: earnings; QUALITY; CONVERGENCE; INFORMATION; STANDARDS; benefits; IMPACT; FIRMS

摘要

We investigate the effects of mandatory International Financial Reporting Standards (IFRS) adoption on the comparability of financial accounting information. Using a set of alternative comparability measures, our results suggest that the overall comparability effect of mandatory IFRS adoption is marginal. We hypothesize that firm-level heterogeneity in IFRS compliance explains the limited comparability effect. To test this conjecture, we first hand-collect data on IFRS compliance for a sample of German and Italian firms and find that firm-, region-, and country-level incentives systematically shape IFRS compliance. We then use these compliance determinants to explain the variance in the comparability effect of mandatory IFRS adoption and find that only firms with high compliance incentives experience substantial increases in comparability. Moreover, we document that firms from countries with tighter reporting enforcement experience larger IFRS comparability effects, and that public firms adopting IFRS become less comparable to local GAAP private firms from the same country.