Interpreting IFRS: The Evolving Role of Agenda Decisions

This study examines the evolution of the interpretative support provided by the IFRS Interpretations Committee (IC), the interpretative body of the International Accounting Standards Board (IASB), over the period 2002–2019. The study focuses on its most frequent output, agenda decisions (ADs), which can provide guidance that practice has long considered relevant and has been explicitly considered authoritative since 2020. We investigate whether the IC has provided additional guidance and changed the formulation of ADs over time in response to constituents’ criticism from the perspective of legitimacy theory. We find that the IC has progressively added more explanatory material and formulated ADs in a more complete and nuanced manner so as to gain consequential legitimacy by substantially addressing the constituents’ interpretation demands. This evolution points to the growing role of ADs, which strike a balance between difficult to reconcile objectives. Providing more substantial support to constituents’ submissions can be seen as a balancing act between a more explicit shift from principles to rules, and leaving room for local interpretations that could threaten the consistent application of International Financial Reporting Standards (IFRS). In shedding light on the IC's substantial response to the challenges posed by conflicting pressures and objectives, we add to the standard-setting literature by providing evidence-based insights into under-researched areas of IFRS interpretation. We also respond to calls for more policy-oriented research and offer two proposals to enhance the clarity of ADs in the light of their evolving content and increasing relevance

Can “publishing game” pressures affect the research topic choice? A survey of European accounting researchers

This study explores the uninvestigated area of research agenda setting, which has considerable influence on the societal impact of accounting academia, which the paying-off mentality stemming from a "publish or perish" culture risks jeopardizing. More specifically, it investigates the research topic choice of accounting researchers to ascertain whether and how the "publishing game" pressures induced by the governance principles of new public management influence this crucial decision. Survey evidence shows that European accounting researchers choose their research topics by considering (i) explicit research requests, (ii) short-term publishing opportunities, (iii) practical and educational needs, and (iv) the intellectual needs of the academic community. In this respect, researchers seem to form a heterogeneous community that places varying importance on these factors, suggesting different effects of "publishing game" pressures. The three clusters aim at societal impact through diverse avenues, while the probability of rapid publishing seems to be the primary driver of another cluster, thus revealing a substantial risk of goal displacement. This study contributes to the debate on publishing pressures in accounting academia by complementing the contextualized reflections of previous literature with evidence documenting their effects on what (in addition to how) accounting researchers study. These findings have policy and practical implications that can help policymakers, university managers, gatekeepers of the publishing process, and our entire academic community

Measuring the Effectiveness of National Enforcers in the IFRS Context: A Proactive Approach

It is widely acknowledged that an effective enforcement system represents a crucial element to achieve significant improvements in financial reporting through the adoption of high-quality accounting standards. Indeed, the quality of financial reporting is considerably influenced not only by the standards to be adopted but also by their actual implementation, and consequently by enforcement mechanisms.The topic has generated considerable interest among scholars, who devoted their attention to developing different measures of the quality of the enforcement system. Building upon this literature, this paper aims at exploring the accounting enforcement system and focuses on controls over financial reporting considering two levels, namely the auditing activity and the controls performed by national enforcers.This paper extends the prior literature by proposing a dynamic measure of the accounting enforcement system capturing controls at those two levels. More specifically, the index here proposed focuses on the quality of the accounting enforcement operated by national enforcers in terms of proactivity, intended as the national enforcers’ capability to detect problems not highlighted in the auditors’ opinions, thus shifting the focus from an input to an output perspective. Indeed, the activities of auditors and national enforcers are strictly connected, given that the auditors’ opinion is the first public output of accounting controls and that is normally one of the bases for further investigation by national enforcers. An illustrative empirical analysis is carried out on the German and the Italian contexts to show the potential of the index for enforcement studies.</jats:p

On the ‘Disclosure Initiative – Principles of Disclosure’: The EAA Financial Reporting Standards Committee’s View

This paper summarises the contents of a comment letter produced by a working group of 12 academics in response to the International Accounting Standards Board (IASB) Discussion Paper on principles of disclosure. The comment letter was submitted by the Financial Reporting Standards Committee (FRSC) of the European Accounting Association (EAA). The work includes reviews of relevant academic literature of areas related to the various questions posed by the IASB in the Discussion Paper, including the ‘disclosure problem’ and the objective of the project, the suggested principles of effective communication, the roles of the primary financial statements and notes, the location of information and the use of performance measures. The paper also discusses the disclosure of accounting policies, the objectives of centralised disclosure, and the New Zealand Accounting Standards Board staff’s approach to disclosure