Question

Professor Ball noted a number of problems with implementing IFRS. What were the problems noted by Professor Ball?

Answer 1

Professor Ball noted these problems with implementing IFRS:

1.

On the con side, a deep concern is that the differences in financial reporting quality that are inevitable among countries have been pushed down to the level of implementation, and now will be concealed by a veneer of uniformity.

 

2.

Despite increased globalization, most political and economic influences on financial reporting practice remain local.

 

3.

The fundamental reason for being skeptical about uniformity of implementation in practice is that the incentives of preparers and enforcers remain primarily local.

 

4.

Under its constitution, the IASB is a standard setter and does not have an enforcement mechanism for its standards.

 

5.

Over time the IASB risks becoming a politicized, polarized, bureaucratic on-style body.