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The purpose of this paper is to explore the underlying assumptions of economic development theories that may support or constrain accounting standard-setting strategies related to IFRS adoption and their potential effects on emerging stock markets (ESMs) development. The authors investigate the country-level association between the extent of IFRS adoption and ESMs development.

The empirical analysis is based on a dynamic panel model using the generalized method of moments for 50 emerging economies over a period spanning from 2001 to 2007.

The authors find that a higher level of IFRS adoption affects positively and significantly stock market development (SMD). More specifically, full IFRS adoption for listed firms is substantially associated with SMD. However, the authors find that partial adoption of IFRS might be not only inappropriate and irrelevant, but also significantly harmful to ESMs development. In addition, it is shown that local GAAPs shaped on the basis of IFRS with major changes are at the origin of such counter-intuitive relationships.

This paper has some policy implications for developing countries. In order to enhance ESMs development, it is important to improve financial information quality through full adoption of IFRS. In a global economic system, it is essential to standard-setters as well as market regulators in non-adopter developing countries to require full IFRS adoption.

This paper extends previous work of Larson and Kenny (1996) in establishing relationships between standard-setting strategies faced to IFRS and theories of economic development. The authors investigate the effects of these standard-setting strategies on SMD using a sample of 50 emerging economies.

The purpose of this study is to investigate the dynamics of capital structure for businesses in China and India. Whether and how they adjust their capital structures to witness the trade-off behaviour in the light of different macro-level factors.

Firms listed on the National Stock Exchange and Shanghai Stock Exchange over the period of 2009-2018 are used for the study. System generalized method of moments proposed by Blundell and Bond (1998) is deployed due to the use of dynamic short panel data.

Indian firms revert to their target leverage ratios at a higher rate as compared to Chinese firms (30 and 20 per cent, respectively). Further, the inflation rate, bond market and stock market development are significant factors impacting leverage in the case of India, whereas bond market development significantly impacts leverage in the case of China. These results are robust across various definitions of leverage and other firm and institutional control variables.

This study has implications for various stakeholders. The study highlights that development in financial markets and economy impact the financing decisions and should be a cause for concern for the financial managers and policymakers. Thus, managers can use the findings of the study if they desire to maintain their target capital structures for better firm valuation and the policymakers can support them in achieving the same. Even, the investors can make informed investment decisions considering macro-level factors impacting firms’ financing choices.

It is believed to be the first piece of research effort to consider the novel paradigm of the macro-level factors impacting the target leverage to estimate the adjustment speed. Secondly, it is a pioneering study, which attempts to compare the trade-off behaviour of the top two emerging economies of the world.

The objective of this study aims at reviewing a synthesis of the economic impact of the implementation of International Financial Reporting Standards (IFRS) in an attempt to provide directions for future research. There are significant evidences of adopting a high-quality set of harmonised accounting standards (i.e. IFRS) fosters trade and foreign direct investment (FDI), financial transparency, and comparability and reduces information asymmetries. From the extensive structured review of literature using the Scopus database tool, the study reviewed 108 articles, and in particular, the topic-related 41 articles were analysed. Seven journals contribute to 39% of the articles (The Accounting Review; European Accounting Review; International Journal of Accounting; Journal of Accounting Research; Revista Espanola de Financiacion y Contabilidad; Asian Review of Accounting; and International Journal of Economics and Management). However, most of the cited journals were Journal of Accounting Research, The Accounting Review, European Accounting Review, and International Journal of Accounting (Armstrong, Barth, Jagolinzer, & Riedl, 2010; Brüggemann, Hitz, & Sellhorn, 2013; Christensen, Lee, & Walker, 2007; Daske, Hail, Leuz, & Verdi, 2008, 2013). Most of the studies did not use any theory, and most of the articles utilised quantitative approach. The study calls for future research on the theoretical impactions on the economic impact of IFRS implementation in a country-specific study, cross-country study, and global study. Future studies should also focus on the policymaking agenda for the local and international standard setters.

The purpose of this study is to review a synthesis of International Financial Reporting Standards (IFRS) implementation in developing countries in an attempt to provide directions for future research. The in-depth analysis was performed with the use of the data analysis tool available in the Scopus databases. The study initially reviewed 145 papers and in particular 35 papers were analysed. Fifteen articles (43%) were published in seven journals including International Journal of Accounting, Critical Perspectives on Accounting, Advances in Accounting, International Journal of Accounting and Information Management, Asian Review of Accounting, Journal of Applied Accounting Research, and Asian Journal of Business and Accounting. Specifically, 89% citations were from 14 articles, but 9 (25%) articles were without any citations. Most of the studies focus on qualitative followed by quantitative, and very few studies were based on mixed methods. Researchers should focus on few areas for future research on IFRS implementation in developing countries including theory implications, policy prescriptions, and case of particular standard.

The purpose of this paper is to examine the level of accounting development and the adoption of IFRS in the four foremost economies in the Middle East and North Africa (MENA)—Egypt, Jordan, Libya and UAE. Through the lens of institutional theory, the study investigates the impact of economic, political, legal and cultural institutions on the development of these countries’ accounting practices and their readiness to use IFRS.

This research uses accounting development indices obtained from current literature as well as recent World Economic Forum and UNCTAD reports to examine the development of accounting in these MENA countries and their inclination to adopt IFRS.

The study identifies a number of impediments to the development of accounting practices and adoption of IFRS in these countries. It also reveals that three of the four MENA countries (Egypt, Jordan and UAE) could be placed on a level playing field with their principal trading partners (the US, the UK, Germany and Italy) given the formers’ business environments, methods of raising finance and levels of professional accounting practices.

Although limited to only four jurisdictions, findings from the study have important implications for investors and parties that are interested in improving the value relevance of the information presented by firms especially in a globalised economy with increasing cross-listing.

This study extends the frontier of knowledge on the development of accounting and IFRS adoption by focusing on the MENA region. It is the first effort that the authors are aware of to adopt such a multifarious approach.

This paper aims to investigate the effects of the early adoption of International Standards on Auditing (ISAs) on Financial Market Indicators (FMIs) from a diffusion of innovation (DOI) theory perspective.

Using panel data from 110 countries in a period that spans from 1995 to 2014, this study applies an ordinary least squares regression model to investigate the financial consequences of adopting ISAs. This analysis was supplemented with estimating a fixed-effects and two-stage least squares regression models to address any concerns regarding the possible existence of endogeneity problems.

This study reports three key findings. First, the authors find that early ISAs adoption has a negative effect on several financial market consequences, namely stock market integration, market capitalisation, market turnover, market return, market development, stock price volatility and stock trading volume. Second, using an alternative measure to the one that is proposed by DOI theory, the authors found that some financial indicators have been significantly improved after ISAs adoption, but only for listed firms that prepared their financial statements under International Financial Reporting Standards and audited by ISAs simultaneously. Finally, the financialindicators of European stock markets, however, have insignificantly shrank post the mandatory adoption of ISAs in 2006.

The empirical evidence raises questions about how ISAs were enforced and implemented. For example, countries that adopted ISAs at early stages may have been dominated mostly by recently established stock exchanges. This implies a crucial need to determine and apply the best type of auditing regime that can increase investors trust and enhance the credibility of stock markets information, which might ultimately advance the FMIs over time significantly.

To-date, studies investigating the impact of the adoption of ISAs on FMI from a DOI theory perspective are virtually non-existent. The study, therefore, seeks to contribute to the extant literature by examining the influence of ISAs adoption on a wide range of FMIs.

The purpose of this study is twofold. On the one hand, it studies the impact of IFRS 9 adoption on the firm value; and on the other hand, it investigates the impact of the classification of financial assets on the firm value.

The study covers a sample of 55 listed banks in the Middle Eastern and North African (MENA) region. Data is collected for three years (2017–2019).

The findings show that banks’ value is not impacted by IFRS 9 adoption but by financial assets’ classification. Firm value is positively affected by fair value through other comprehensive income assets, while it is negatively affected by amortized cost and fair value through profit or loss assets. The results of the additional analysis show consistent outcomes.

This research reveals important managerial implications. Priority should be given to the financial assets’ classification strategy following the adoption of IFRS 9 to boost the market valuation of banks. It may be useful for investors, managers and regulators in their decision-making.

This study enriches previous research as IFRS 9 is a new standard, and its adoption consequences need to be investigated. A few recent studies have focused on IFRS 9 as a whole or on other parts of IFRS 9, namely, the impairment regime and hedge accounting and concern developed contexts. However, this research adds to the knowledge of capital market studies by investigating the application of IFRS 9 in terms of classification in the MENA region.

This paper aims to examine the theoretical underpinnings of international financial reporting standards (IFRS)-related studies and offers directions for theoretical and empirical research. Specifically, this study examines the main theories in IFRS adoption research (i.e. adoption, compliance and effects).

The sample contains 67 empirical papers that have used theories and was collected from Web of Science database. This study uses a systematic review technique.

Generally, the review shows the prevalent and pervasive use of institutional theories of isomorphism across all the three areas of IFRS adoption. Particularly, regarding IFRS adoption stream, this study finds the institutional theory as a dominant theory used to explain IFRS diffusion around the globe. For IFRS compliance, this study finds that the agency and the capital need theories are widely used. For IFRS adoption effects stream, this study finds a few studies using the contingency and neo-institutional theories. Overall, the review provides theoretical lens for IFRS adoption, IFRS compliance and IFRS adoption effects.

Given the lack of a well-defined set of theories in the domain of accounting, the findings provide further guidance on theory building within the field. Further, accounting regulators, academics and practitioners may benefit from the findings when explaining various changes in the world of accounting.

The purpose of this paper is to discuss accounting development in Tunisia, which is a developing North African country little known in the international accounting literature.

Methodologically, this paper is based on an exploratory approach. It uses the descriptive tradition of research by collecting and analyzing numerical and narrative data to identify and describe environmental factors that favor or hamper accounting development in Tunisia.

This paper indicates that Tunisian companies have been applying the Enterprise Accounting System (EAS) since 1996. This system, while keeping with the logic of a chart of accounts, represents a first attempt to harmonize with international accounting standards. Accounting harmonization in Tunisia is meant to support the strategy, launched in the early 1990s, to integrate the country into the globalization process. Accordingly, the EAS has helped to achieve macroeconomic benefits (public interests). However, it does not lead to the desired level of financial transparency (private interests), especially that of large companies. Currently, Tunisian Accounting Standards neither reflect the rapid evolution of business activity nor changes in international accounting standards. This unachieved harmonization has led some listed companies to comply with some International Financial Reporting Standards which are not included in the EAS.

The unachieved harmonization in Tunisia is mainly related to the political system, taxation factors, the legal system, the weak state of corporate governance and governmental control over standardization.

This paper provides insights into the problems of developing countries that harmonize with international standards to achieve public interests. These countries may encounter many difficulties in bringing their accounting standards up to date. These difficulties seem to be associated with environmental specificities. Accordingly, international standardization bodies and developing country regulators should take into account environmental factors which are determinant for the harmonization decision to succeed.

This paper contributes to the existing literature on accounting development in developing countries. It implies that recent accounting development, as it is designed in Tunisia, is better suited to the needs of small businesses. Large companies would be compelled to complement local generally accepted accounting principles by standards they choose, voluntarily, among international standards.

The purpose of this paper is to examine the impact of International Financial Reporting Standards (IFRS) adoption on economic growth.

Using data from 2005–2014, the study examined whether the mandatory adoption of IFRS increases economic growth synchronicity in the European Union (EU) context. The study utilizes a sample of 28 countries containing 10-year observations in the EU market where IFRS have been adopted since 2005. The empirical model, relating to economic growth synchronicity with the adoption of IFRS, and other country-specific control variables were analyzed using the dynamic panel data technique.

Different specifications of the model results showed that IFRS adoption improves the economic growth and that IFRS adoption matters for developing economies than developed ones. It is, therefore, recommended that authorities in Europe should try to enforce the adoption and implementation of IFRS, especially among the developing economies.

The paper’s investigation of the impact of IFRS on economic growth expands the extant literature. Studies that dealt with IFRS impacts mostly fixate on the accounting benefits of IFRS adoption to institutional investors and fail to capture the commensurate impact of IFRS adoption on macroeconomic indicators. This little attention is because prior researchers suggest IFRS adoption is important in shaping financial reporting characteristics which provide useful information to the prime users of financial reports. Also, separating the study’s countries into developed and developing countries would help delineate the impact of IFRS adoption on economic growth based on the stage of development.