Question

The impact of country factors on the adoption of IFRS

Answer 1

SME-IFRS adoption is higher in common law origin countries compared to code law countries. ... These eight factors include major sources of finance, legal systems, taxation, political and economic ties, inflation, economic development, education, and culture.

Moreover, many studies explored the link between the above-mentioned forces and IFRS adoption; focusing variously on the economic determinants of the decision (e.g. Ramanna and Sletten 2014;Shima and Yang 2012;Zeghal and Mhedhbi 2006), on the institutional factors that lead to adoption (e.g. Judge, Li, and Pinsker 2010;Lasmin 2011), and on the impact of cultural dimensions and political ties on adoption (e.g. ...

... Judge, Li, and Pinsker 2010;Lasmin 2011), and on the impact of cultural dimensions and political ties on adoption (e.g. Archambault and Archambault 2009;Clements, Neill, and Stovall 2010;Shima and Yang 2012). Another group investigated the relationship between IFRS adoption and legislative systems (e.g. ...

... However, the evidence provided by the above studies is inconclusive. For instance, Shima and Yang (2012) found a significant positive relationship between cultural values and IFRS adoption, while Dima et al. (2013) found none. Ramanna and Sletten (2014) found no significant relationship between IFRS adoption and country size, while Clements, Neill, and Stovall (2010) documented that larger and politically powerful countries were less likely to adopt. ...