Search results

Since the withdrawal of IFRIC 3 in 2005, there has been a regulatory freeze in accounting for emission rights that contrasts with the international momentum of climate-related financial disclosures. This paper explores how different narratives and institutional dynamics explain the failure to produce guidance on accounting for emission rights.

This paper mobilises the notion of field-configuring events to examine a sequence of six events between 2003 and 2016, including four public consultations and two dialogues between standard setters. The paper presents a qualitative analysis of documents produced in this space that investigates how different practices and narratives configured the field's positions, agenda, and meaning systems.

Accounting for emission rights was gradually decoupled from climate change and carbon markets, relegated to the research pipeline, and forgotten. The obstacles that the IASB and EFRAG found in presenting themselves as central in the recurring events, the excess of representations, and the increasingly technical and abstract debates eroded the 2003 momentum for regulation, making the different initiatives to revitalise the project vulnerable and open to scrutiny. Lukes (2021) refers to nondecision-making to express that some issues are suffocated before they are expressed.

The regulation of accounting for emission rights, an area that has received scant attention in the literature, provides some insights into the different narrative mechanisms that, materialising in specific times and spaces, draw regulatory attention to particular accounting issues, which are problematised and, eventually, forgotten. This study also illustrates that identifying interests is problematic as actors shift from alternative positions over a long period. The case examined also raises some doubts about the previous effectiveness of international standard setters in dealing with matters of connectivity between the environment and finance, as is the case for accounting for emissions rights.

Drawing on institutional theory analytical perspectives of theorisation and translation, this study aims to explore the institutionalisation of eXtensible Business Reporting Language (XBRL) in Indonesia from a regulatory and filer perspective.

The Indonesian capital market offers a unique case of the integration of XBRL regulatory reporting between multiple regulators and a transfer from capital market regulation to state-level regulation. This study uses semi-structured interviews with key actors employed with Indonesian XBRL-regulatory bodies and listed companies (filers).

External pressures, monitoring issues and tensions in the implementation process were instrumental in the theorisation and translation of XBRL in Indonesia. Specifically, the findings show that choices made with respect to XBRL regulation and implementation created tensions between XBRL reporting fulfilling a monitoring purpose and serving stakeholders’ interests. The findings also indicate that the Indonesian approach to XBRL regulation and implementation had distinct characteristics compared to XBRL implementation in other jurisdictions.

This study emphasises the necessity for robust regulatory support and strict enforcement to navigate the complexities and tensions arising from a multi-regulatory approach. Additionally, it stresses the importance of firms’ readiness and expertise in XBRL as more sophisticated implementation strategies are considered.

Using the analytical lens of theorisation and translation, the study provides a deeper understanding of how a globally diffused accounting technology was institutionalised and legitimised in a developing country. Specifically, this study explains why a conversion approach to XBRL implementation was favoured and how XBRL implementation and reporting were managed and coordinated between different Indonesian regulators.

The aim of this paper is to propose a basis upon which accounting reporting can be developed to reflect real values and the real economy. It aims to address the environmental considerations discussed in the UN debate (Bebbington and Unerman, 2020) and the concern for a “better life-world”, which is the theme of this special issue.

Addressing the task involves the application of the philosophy of pragmatic constructivism (which explains how people can relate to their reality in ways that lead to successful action) and the philosophical concept of the “good life” (which establishes the values to be pursued through action and so defines action success). Also, it outlines the necessary characteristics of measurement frameworks if they are to be effective in the development and control of human practices to achieve desired values.

This paper proposes a conceptual framework for guiding the measurement of how a sustainable good life has improved and/or deteriorated as a result of organisational activities. It outlines a system of concepts on basic and instrumental values for analysing the condition of maintaining a sustainable good life in real terms. This is related to the financial results and societal regulations to analyse and adjust controls according to the real economic goals. Also, it provides a system of value measurands to produce valid information about the development of a sustainable good life. The measurand makes accounting reporting reflect the conditions of the good life that constitute the real economy instead of merely the financial economy driven by shareholder capitalism. Providing tools to analyse whether the existing practices of business and social regulations promote or counteract the real economic goals of producing a sustainable good life means the measurement system proposed makes the invisible hand of the market visible.

The mechanism proposed to enable accounting reporting to reflect real values and the real economy is a new conceptual framework that will allow accounting to more fully realise its potential to contribute to a “better world”. In aiming to serve a sustainable good life, accounting reporting will inherently foster ethical social practices.

This paper aims to better understand auditing practices as a social phenomenon and management practice through a comparative historical analysis of the emergence of statutory auditing in three European countries, namely, France, Great Britain and Germany between 1844 and 1935.

The authors’ approach is a comparative history relying on a literature review, books pertaining to the period of interest and relevant archives.

The three countries’ trajectories were similar. All featured the promulgation of acts at the second half of the 19th century, the development of the accounting profession and the introduction of new acts to further strengthen statutory auditing around the Great Depression. However, each country took a different path because of the degree of regulation. For instance, the regulation strength and the degree of professionalism differed considerably by country. Business secrecy was also a departure point; it ranged from the rejection of auditors as intruders in France to Germany’s exclusively internal auditing and the UK’s peer auditing. The countries also differed on perceptions of the auditor’s role. Auditors were seen through the lens of a general interest mission in France, as advisors to internal governance bodies in Germany and as shareholders’ agents in Great Britain.

This paper compares three main European countries in the specific context of the introduction of statutory auditing. The findings of this paper are helpful for the international harmonization of auditing standards, as the derived insights provide a better understanding of the differences in the standards’ implementation.

The objective of this study is to investigate how the implementation of an Emission Trading Scheme (ETS) influences an ETS-regulated firm’s level of earnings smoothness.

Using a staggered difference-in-differences model based on China’s ETS pilots commencing in 2013, this study investigates how the implementation of ETS pilots affects regulated firms’ earnings smoothing relative to non-regulated firms. The sample period spans from 2008 to 2019. This model incorporates time-invariant firm-specific heterogeneity, time-specific heterogeneity, and a series of firm characteristics to establish causality. Robustness tests justify findings.

The results show that after implementing an ETS pilot, regulated firms increase their earnings smoothness relative to non-regulated firms. Regulated firms strategically smooth their earnings to obtain additional financial resources and meet compliance costs arising from an ETS. Further analysis reveals that regulated firms’ earnings smoothing activity is a function of environmental regulations, managerial integrity, and capital market incentives.

This study deviates from past research focusing on the environmental consequences of ETS by indicating that an ETS affects regulated firms’ financial reporting decisions. Specifically, regulated firms resort to earnings smoothing as a short-term exit strategy from financing concerns arising from environmental regulations. This finding expands prior literature primarily focusing on the effect of tax and financial reporting regulations on earnings smoothness. This study also indicates that firms utilize earning smoothing to lower their short-term cost of capital, which enables them to access additional financing at a lower cost and reconfigure their operations to meet stakeholder environmental demands.

This study aims to explore the conflicting issues of carbon accounting and trading practices in China through the lens of agonistic democracy.

Based on a framework of three interrelated levels, this study explores emitting entity carbon accounting debates and discussions in mitigating climate change. Interview data were collected from 20 emitting entity participants and external auditors.

This study identifies irreconcilable conflicts between emitting entities and the government in carbon accounting and trading activities. Under the strong influence of government power, emitting entities portray themselves as “responsible” and “legitimate” state-owned enterprises. This study further identifies possible democratic spaces and reveals the potential for agonistic discourse and a fallacy of “consensus” and monologues in institutional space. If the emitting entity and government can overcome their participation challenges, this would significantly facilitate vibrant and agonistic discourse in carbon activities and pave the way for democratic spaces.

This study demonstrates the potential and limitations of applying agonistic democracy and the significance of participation in institutional spaces in government-led carbon accounting and trading issues. It enriches prior research on promoting democratic participation in carbon accounting from the agonistic democracy perspective.

Ethiopia has enacted laws on transparency and disclosure of information in state-owned enterprises (SOEs). However, these laws are not strict enough, with the transparency and disclosure practices disappointing in the country. Thus, this study aims to investigate the legal framework governing transparency and disclosure in SOEs.

This study uses doctrinal, qualitative and comparative approaches. Domestic legal texts are appraised based on the organization for economic co-operation and development Guideline on Corporate Governance of State-owned Enterprises, the World Bank Toolkit on Corporate Governance of State-owned Enterprises and best national practices. This approach has been further corroborated by qualitative analysis of the basic principles of transparency and disclosure.

The finding reveals that the laws on transparency and disclosure do not comply with global practices and are inadequate to ensure transparency and discourse in SOEs. They fail to establish appropriate disclosure frameworks and practices at the SOE and state-ownership entity levels. They also indiscriminately subject enterprises to multiple auditing functions and conflicting responsibilities.

To the author’s knowledge, this study is the first legal literature on transparency and disclosure in Ethiopian SOEs. This study assists the state as owner in reforming the laws and uplifting SOEs from their current unpleasant condition. It can also become a reference for future research.

This study aims to examine the effects of the entry of foreign direct investments (FDIs) on the audit markets in developing countries (i.e. Egypt). There is a long-standing debate on the impact of FDIs on developing markets, but little is still known about the effect of FDI on national suppliers, such as audit firms.

This paper reports the results of a study that used qualitative research methods. It involves interviews with senior management teams of the Big 4 audit firms, to find out how these firms deal simultaneously with conflicting global and local influences. The interviews were complemented by the publicly available data on the firms’ websites as well as published reports related to the Egyptian economy and current investment regulations.

Drawing on the institutional theory, the findings suggest that an increased litigious environment, compliance with developed markets’ regulations, auditor regulatory sanctions and improved local accounting and auditing standards are highly significant consequences of foreign investment inflows. The findings indicate that more emphasis has been given to the quality of audit and auditors’ independence when auditing FDIs. Both audit regulators and audit firms in the domestic market pay higher attention to improving the quality of financial reports when FDIs have entered the market. More inspections and reviews for audit firms have been conducted, and local auditing and accounting standards have been revised to be in compliance with international standards.

Our results have important implications for investors, regulatory authorities and governments in relation to the development, implementation and enforcement of international financial reporting and auditing standards.

Policymakers and regulators in Egypt have responded to international pressure by revitalizing their local accounting and auditing standards and adopting international financial reporting and auditing standards. The authors identify strategies that have been adopted by audit firms to face the FDIs’ challenges.

The purpose of this study is to examine the relationship between pollutant emissions, financial development and IFRS in developed and developing countries between 1998 and 2022.

Data were obtained from World Development Indicators and World Governance Indicators of the World Bank.

Using FGLS and GMM estimators, the results provide evidence that financial development has a significant positive impact on a variety of pollutant emissions. However, this positive impact is moderated by IFRS for the overall sample and country income groups.

Governments and regulatory organizations should support companies’ investments in clean energy and technologies to slow down environmental degradation. Tax credits and subsidies may be helpful to achieve this goal. Also, governments may encourage companies to cooperate with universities and research institutions to develop environment-friendly production and distribution methods to reduce pollution. Although stakeholders may obtain information about environmental issues in financial statements that are prepared in accordance with IFRS, there is a need for standardization of their contents.

Greenhouse gases are major contributors to climate change and global warming. In addition to private costs borne by producers, the production and consumption of products have social costs arising from pollution that affects air, water, and soil. Pollution adversely affects people's physiological and psychological health, which decreases labor productivity, thereby leading to a decrease in economic growth.

According to the author’s knowledge, this is the first study that examines the impact of IFRS on the relationship between financial development and pollutant emissions.

The purpose of this study is to discuss the most relevant literature related to the adoption of International Public Sector Accounting Standards (IPSAS) in the public sector in developed and developing countries, identifying the constraints and stimuli they represent in the implementation of the public accounting reform. It also presents future research proposals on the factors identified.

The methodology is based on a systematic review of the literature described by Moher et al. (2009). The final sample includes 90 academic papers published from 2000 to 2022.

The main findings indicate that there are differences between constraints and stimuli in the implementation of accounting standards between developed and developing countries. In terms of constraints, the main factor in developed countries is the lack of training, whereas in developing countries it is the limitation on financial resources. In addition, the results demonstrate that in developed countries the factors that most encourage the implementation of accounting standards are modernization and improvement of accounting, while in developing countries, encouragement comes mainly from external and internal pressure.

This study helps countries and institutions to learn from experience and better prepare for the accounting reforms of public administration that they will undertake. Managers of public organizations may be willing to make decisions in the adoption of IPSAS if they take into account the factors established herein.

This study helps countries and institutions to learn from the experience, better prepare for the public administration accounting reforms that they will undertake and add greater transparency in the accountability of public accounts to citizens.

In addition to previous studies, this study addresses a number of factors perceived by those involved in the implementation of IPSAS in developed and developing countries and provides a robust research agenda to pursue during the coming years, as there are several important unexplored questions that invite further research.