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The International Accounting Standards Board (IASB) has justified the simplification of International Financial Reporting Standards (IFRS) for small- and medium-sized enterprises (SMEs) in several ways, but no effective justification for this simplification has been made based on the information needs of users. This study aims to provide empirical evidence of the decision usefulness of IFRS for SMEs from a prominent user group of SME financial statements – the banks.

This study uses a mixed-method approach. First, a survey was conducted on commercial bank lending officers to assess the usefulness of different disclosure items included in the SME financial statements. Second, semi-structured interviews were conducted with commercial bank lending officers to gain an in-depth insight into the appropriateness and economic consequences of the requirements of IFRS for SMEs on their lending decisions.

The findings show that commercial bank lending officers did not consider all the disclosure requirements presented to them to be equally important. Hence, to facilitate the actual needs of the users’ decision usefulness, it is imperative that when given the opportunity, users participate in the development of accounting standards.

The findings of this study will be of interest to accounting regulators for evaluating the successful implementation of IFRS for SMEs and planning the next review of IFRS for SMEs. The IASB and SME Implementation Group are presently considering ways to increase user involvement for the next review of IFRS for SMEs, and the findings of this study signify the need for user involvement in the standard setting process.

The purpose of this study is to examine the indirect relationship between the mandatory adoption of International Financial Reporting Standards for small and medium-sized enterprises (IFRS for SMEs) and the corporate governance index (CGI) by checking the mediating effect of the quality of financial statements (QFS) on this relationship.

The main objective of the IFRS for SMEs standard is to meet the specific needs of SMEs in transition and developing economies. Here, the authors used the structural equation method to investigate SMEs in countries that mandate the application of IFRS for SMEs for the years 2010 (pre-adoption) and 2016 (post-adoption). The final sample covered two emerging countries: the Dominican Republic and El Salvador.

The results show a positive association between the adoption of IFRS for SMEs, CGI and QFS. Furthermore, the findings confirm that the relationship between IFRS for SMEs adoption and CGI is under the control of the QFS.

This study provides standard setters and managers of SMEs with an overview of the importance of QFS on the significance of this relationship in emerging countries. The study contributes to the literature by examining the indirect relationship between IFRS for SMEs and CGI and building a CGI that integrates a set of governance practices linked to SMEs.

This paper aims to examine the perceptions of owners and accountants of small- and medium-sized entities (SMEs) on the users and their financial information needs of SME financial reporting.

Postal questionnaire surveys with owners and accountants of SMEs were used to identify users and their financial information needs. In total, 1,498 questionnaires were sent to SME owners and accountants. A total of 358 questionnaires were returned, generating 323 useable questionnaires. The management branch of stakeholder theory is used for the study which asserts that company management is expected to meet the expectations of those stakeholders who are more powerful than others.

The users of Sri Lanka SME financial information were limited to owners, banks and Department of Inland Revenue. Users and financial information needs of owners varied in relation to the size of the SME. Financial information are useful for making capital investment and planning decisions for owners regardless of the size of the SME. By sharing information with outside parties, disclosures can diminish information asymmetries between the firms and its stakeholders. The top three reasons for which owners use SME financial information are for planning purposes, estimating income tax liabilities, and taking marketing and pricing decisions.

Since the study focuses only on the views of owner-managers and accountants of SMEs, the holistic understanding of uses of SME financial information by other user groups cannot be achieved.

The results of this study provide international and local standard setters with an indication of future direction for SME financial reporting.

This paper extends existing knowledge on users and their financial information needs of SMEs in developing countries. Consequently, the findings of this paper make a valuable contribution to the work of practitioners such as local and international standards-setters and regulators who may be considering developing/revising financial reporting framework for SMEs either worldwide or in developing countries.

Although SME financial reporting has attracted enormous attention in the recent accounting literature, academic research into SME financial reporting is scant. This paper extends existing knowledge on users and their financial information needs of SMEs in developing countries. The general purpose financial reporting model and the accounting standard IFRS for SMEs in particular would not be applicable to Sri Lankan SMEs unless it modifies to reflect the financial information needs of users of Sri Lankan SME financial information.

Small- and medium-sized enterprises (SMEs) carry huge economic importance worldwide. At the same time, SMEs face specific challenges, some of which may be alleviated by employing accountants. However, research on the role and impact of accountants in SMEs has long remained fragmented and scarce. This paper aims to encourage more research on accountants in SMEs by providing the first comprehensive and systematic review of relevant research.

Based on systematic review methods, the authors critically examine 68 research articles dealing with accountants in SMEs.

The review identifies three dominant roles for accountants in SMEs: providers of reporting services, sources of SME owners’ self-validation and translators between capital providers and SMEs and advisors. Implicitly, many studies assume a value-enhancing effect of employing accountants in SMEs regardless of these specific roles. At the same time, available studies seldom make use of existing theoretical frameworks to more closely analyze the value-enhancing potential of human resources such as accountants. The authors, thus, propose the resource-based view as a robust theoretical framework to improve theory building in research on accountants in SMEs.

To the best of the authors’ knowledge, this paper is the first systematic review of accountants in SMEs. In addition, the authors develop a resource-based model on accountants in SMEs to guide future research on this topic.

Building information modeling (BIM) is a prominent concept to digitalize data collection and analysis processes. Small and medium-sized enterprises (SMEs) account for a considerable percentage of the works performed in the construction industry. The adoption rate of BIM by SMEs is still, however, not at the desired level in the New Zealand construction industry. This study aims to evaluate barriers to BIM implementation for SMEs in the New Zealand construction industry.

This study adopted four-step methodology to evaluate barriers to BIM adoption for SMEs. First, a comprehensive literature review, followed by a focus group discussion was performed to identify barriers to BIM adoption. Then, analytical hierarchy process (AHP) was used to assess identified barriers. Finally, experts’ agreements (both internal and external) were ensured by consistency analysis and Kendall’s coefficient of concordance (Kendall’s W) tests.

The findings indicate that (1) interoperability between software platforms, (2) lack of government mandate on BIM usage at project level, (3) high cost of acquiring the software and licensing required to use BIM and (4) lack of client demand for adopting BIM were the most significant barriers in terms of technological, governmental, resource and cultural categories, respectively. Further investigation of the expert evaluation showed strong consistencies (each expert separately) and agreements (among experts) in each AHP matrix.

Primary focus should be training of local market (particularly SMEs) professionals as the shortage in qualified professionals makes the country-wide adoption challenging. The publicity in the local market can help SMEs understand how BIM is leveraged for further improvements in project performance.

Overall, this research not only provides a roadmap for the widespread adoption of BIM within SMEs in New Zealand through analysis of the barriers encountered but also highlights the power that policymakers hold over the mass adoption of BIM within SMEs.

The purpose of the study is to investigate the association of earnings and cash flows with stock prices and returns, and the impact of regulatory changes on the value relevance of accounting numbers.

The authors examine a sample of non-financial firms listed on the Belgrade Stock Exchange from 2005 to 2018 and use three regression models – price, return and differenced.

The authors find evidence that accounting earnings are more value relevant than cash flows. The authors also find negative relation of earnings changes with stock returns and argue that this is due to the lower persistence of negative earnings levels and changes. Finally, the authors find that the value relevance of accounting information in Serbia increases after the improvements in capital market regulation.

Given the empirical focus on a transition economy, the widespread applicability of the study is limited. The findings, however, call for more research on transition economies to better understand the functioning of capital markets and the way information from financial statements is incorporated into stock prices.

The results imply that policymakers in transition economies should improve the accounting and capital market regulation to provide better investor protection and to improve the capital market conditions.

The authors add to knowledge about the value relevance of accounting information in emerging and transition economies. The results could be of interest to standard setters in their efforts to better understand and improve the quality of accounting information in emerging and transition economies.

An understanding of the role of decision-making has been emphasised since the seminal works on human information processing and professional judgements by accountants. The interest in these topics has been reignited by the increasing digitisation of the financial reporting and auditing processes. Whilst the behavioural research on accounting is well-established, the application of seminal works in cognitive psychology and behavioural finance is lacking, especially from recent research endeavours. The purpose of this paper is to provide a synthesis of theories relating to accounting behavioural research by evaluating them against the theories of cognitive psychology.

Using theory synthesis, this research draws seemingly isolated strands of research into a coherent framework, underpinned by cognitive psychology.

Evidence from accounting and auditing behavioural research is largely consistent with the psychology and finance research on cognitive limitations and errors. There remains a lacuna in accounting behavioural research on debiasing techniques. Such research, if underpinned by a single, cohesive theoretical framework, is likely to have practical relevance.

The current research has theoretical implications for the accounting decision-making and uncertainty research. Areas for future research, based on identified gaps in the current accounting behavioural research, are also proposed.

The purpose of this paper is to investigate the effect of institutional structures on the strength of auditing and financial reporting standards.

This paper employs a panel data of 36 African countries over the period 2000–2018. System generalised method of moments (SGMM) was employed to estimate the relationship between institutional structures and the strength of auditing and financial reporting standards in Africa.

The findings of this paper indicate a positive and statistically significant relationship between institutional structures and the strength of auditing and financial reporting standards. As a further analysis, the study finds that the relationship between institutional structures and the strength of auditing and financial reporting standards is stronger for economies with common-law accounting traditions than those with civil-law origin.

The paper has important implications for countries striving to adopt and implement auditing and financial reporting standards fully. Such efforts must begin with establishing strong institutional structures in those countries.

This study presents the first empirical panel data evidence on the effect of institutional structures on the strength of auditing and financial reporting standards in Africa. Further, the methodology employed in this study can be regarded as effective in testing the phenomenon in other regions, or it can be employed as a guiding model for future research in the area.

The objective of this paper is to extend the debate on audit quality in the less complex entity (LCE) context by analyzing comment letters submitted to the International Auditing and Assurance Standards Board (IAASB). The IAASB has drafted a new, stand-alone standard for audits of LCEs’ financial statements.

The Gioia method is utilized to conduct the qualitative analysis. This enables the material to shine and provide a comprehensive picture of the important aspects of the comment letters about the International Standard on Auditing (ISA) for LCEs. A content analysis of the 145 comment letters is conducted to identify the extent of the support for and the arguments against the new, stand-alone draft standard for audits of LCEs’ financial statements. In addition, this study considers how the comment letters describe the respondents’ views on audit quality in relation to the new standard. Finally, the tone of the comment letters and audit quality arguments is investigated.

The findings provide a useful framework of the most frequently used arguments supporting and opposing the ISA for LCEs. Within the themes identified, a wide variety of issues and concerns are discussed. The results reveal that the arguments in the comment letters are contradictory. For instance, when discussing audit quality, those interest groups that perceived many positive opportunities in the adoption of the ISA for LCEs thought that the audit quality would increase. Conversely, those interest groups that were skeptical about the success of the ISA for LCEs argued that the audit quality could be compromised by the general prejudice that the ISA for LCEs might be perceived as a lower-quality audit with fewer procedures.

This paper is, to the best of the authors’ knowledge, the first to examine the content of comment letters in the context of a new, stand-alone standard for audits of LCEs. The international audience can utilize the results in the context of the widely discussed issue of reducing LCEs’ auditing obligations. This study aims to contribute to the two streams of accounting literature concerning audit quality and political lobbying.

As a new research interest, robots have surpassed human performance across several aspects. In this research, the authors wish to investigate whether robot adopters perform better than non-adopters in terms of export behavior, especially when distinguishing between different types of firms.

The authors try a new strategy to identify the extent of robot adoption by import data and compare the export trajectories of robot adopters and non-adopters by employing the propensity score matching-difference in difference (PSM-DID) method.

The authors find that robot adopters are more likely to enter export markets and improve subsequent export performance, as the gains from doing so can spread the reduction in variable production costs to a larger customer base abroad. But this rule does not always seem to work; for large-scale firms, robot adoption makes it easier to win export competition and increase market share, while small and medium-sized enterprises (SMEs) do not seem to enjoy any benefits from adoption. More importantly, robot adoption also leads to the fiercer market competition when improving the productivity of firms, which will threaten smaller non-adopters.

The findings provide new evidence for the scale bias of robotics and offer new insights into whether exporters or future exporters ought to adopt robots in production.

1. First, distinguishing from existing research, we explain the controversial results of previous work on robotics by providing evidence from export markets and using the concept of size bias, which helps to update the theoretical interpretation of robotics and provides new insights for current and future exporters to evaluate their robot adoption decisions.

2. Second, we extend previous research by further considering the potential robotics threats faced by non-adopters, especially we record that export gains of robot adopters are partially at the expense of smaller non-adopters, which provides new evidence for the rationale of SME protection policies and supplements robotics theory with new knowledge, such as the competitive game of firms related to robot adoption.

3. Third, to our knowledge, prior research tended to examine the economic effects of robotics through industry data provided by the IFR, this may lead to systematic bias due to the inability to distinguish the robot adoption intentions of different firms. In this respect, we try a new strategy through robot import data and further distinguish between robot adopters and non-adopters in the sample, which helps to mitigate the potential bias in the findings and provide a complement to the recently developed literature related to robotics.

4. Finally, as we pointed out earlier, robot adoption could be an interesting research work for the Chinese export market, which helps us to obtain some special findings, such as in assessing whether the benefits of robots are equally appropriate for economies that previously had an advantage in terms of labor.

First, distinguishing from existing research, we explain the controversial results of previous work on robotics by providing evidence from export markets and using the concept of size bias, which helps to update the theoretical interpretation of robotics and provides new insights for current and future exporters to evaluate their robot adoption decisions.

Second, we extend previous research by further considering the potential robotics threats faced by non-adopters, especially we record that export gains of robot adopters are partially at the expense of smaller non-adopters, which provides new evidence for the rationale of SME protection policies and supplements robotics theory with new knowledge, such as the competitive game of firms related to robot adoption.

Third, to our knowledge, prior research tended to examine the economic effects of robotics through industry data provided by the IFR, this may lead to systematic bias due to the inability to distinguish the robot adoption intentions of different firms. In this respect, we try a new strategy through robot import data and further distinguish between robot adopters and non-adopters in the sample, which helps to mitigate the potential bias in the findings and provide a complement to the recently developed literature related to robotics.

Finally, as we pointed out earlier, robot adoption could be an interesting research work for the Chinese export market, which helps us to obtain some special findings, such as in assessing whether the benefits of robots are equally appropriate for economies that previously had an advantage in terms of labor.