Effects of the application of the IFRS in less developed countries. A review of empirical studies

Efectos de la aplicación de IFRS en países menos desarrollados: Revisión de estudios empíricos

This paper aims at presenting the positive and negative effects of the implementation of the IFRS in countries less developed, located in four regions: Africa, Latin America, Asia and Eastern Europe. The method used is a systematic revision of literature on empirical studies published in Scopus’ journals. This systematic revision was conducted according to a method legitimated in the British Academy of Administration. The empirical studies analyzed were classified in two groups: in the first one we have papers that deal, simultaneously, with the experiences of more than 30 developed countries; in the second one,  we include a great number of papers dealing with case studies, by country, which analyze both the historical evolution and the history of the Accounting Standards applied in the country as well as the characteristics of the process of adoption of the IFRS and the impacts of such a process. In general, the empirical studies show: (1) low impact of the implementation of the IFRS on the flows of capital and on the “quality” of the information; (2) institutional resistance; (3) incompatibility of the IFRS with local accounting norms; (4) the need to qualify the accountancy professionals to produce the reports; (5) prioritize the fiscal rules of the organization over the rest of the norms; (6) differences in the process of convergence between the Pymes and the big companies and (7) difference in the perception by the investors and report preparers. The local organisms of control and the international standards of auditing are pressuring institutionally for the application of the IFRS.