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We investigate the interaction of debt covenants and tax accounting on the adoption of Financial Interpretation No. 48 (FIN 48). We examine how firms respond to the potential tightening of covenant slack upon FIN 48 adoption and whether these actions are penalized by creditors and anticipated by equity markets. We find that upon FIN 48 adoption, the majority of sample corporate borrowers increase their tax reserves and reduce equity. Firms close to debt covenant violation were even more likely to increase tax reserves upon FIN 48 adoption; however, the size of the adjustment was relatively smaller, suggesting that the FIN 48 standards limited, but did not eliminate, firms use of discretion in reporting uncertain tax positions to avoid costly covenant violations. For firms near net worth debt covenant violation, the act of decreasing equity upon FIN 48 adoption imposes real economic costs, as the average cost of debt increased by 43 basis points. Finally, we extend prior research on the market response to FIN 48 by showing how the market response to FIN 48 adoption is a function of debt covenant slack and tax aggressiveness. Specifically, the cumulative abnormal return at the FIN 48 exposure draft release date is negative only for tax aggressive firms that are close to debt covenant violation.

International rule-governed activity also includes nonstate actors on the national as well as on the international and transnational levels. This chapter first discusses the relationship between educational governance and regime theory, then some observations on the theoretical perspective and the analytical categories are outlined. Second, a concise discussion of regime theory is presented and a definition of an emerging international education regime (IER) is elaborated, including some of the key elements and features that illustrate the adopted theoretical framework. Third, the chapter addresses some methodological questions and presents one possible research design to discuss empirical implications of an emerging IER.

This paper is intended as an overview and think piece, contributing to literature identifying accounting’s impact in making things knowable. Critical accounting research has always sought alternative ways of understanding the discipline and the legacy is extended here by considering pathways forward. Accounting continually impacts public policy in what it privileges for selecting and in what it silences and neglects. Given that humans are meaning-making we have choices, and this essay interrogates accounting techniques operating as façades while disguising social impacts. Promoting qualitative accounting research that reimagines these complexities and considers moral contexts is the substance of this essay, for advancing the public interest in accounting.

The study critically evaluates the theory of International Financial Reporting Standards (IFRS) implementation in an attempt to provide directions for future research. Using the extensive structured review of literature using the Scopus database tool, the study reviewed 79 articles, and in particular the topic-related 57 articles were analysed. Nine journals contribute to 51% of articles (29 of 57 articles). In particular, the three journals published 15 articles: Critical Perspectives on Accounting (7), Accounting, Organizations and Society (4), and Journal of Applied Accounting Research (4). In total, 83% (47 of 57) of the articles were published 2009–2018. A total of 1,168 citations were found from 45 articles since 12 articles were without citations. The highest cited authors were Ball (2006) – 410 citations, Kothari, Ramanna, and Skinner (2010) – 135 citations, and Napier (1989) – 85 citations. In particular, five theories have been used widely: institutional theory (13), accounting theory (6), agency theory (3), positive accounting theory (3), and process theory (2). Future studies’ focus could be on theory implications in IFRS adoption/implementation studies in a country or a group of countries’ experience. Future studies could also focus on various theories rather depending on a single theory (i.e. institutional theory).