Assessing international accounting harmonization in Latin America

Abstract

We draw on institutional theory and interviews with key informants to assess international accounting harmonization in the 13 countries of the Group of Latin American Accounting Standards Setters (GLASS). Some GLASS countries have effected full formal adoption of International Financial Reporting Standards (IFRS), but in others, IFRS are not permitted. In several GLASS countries, IFRS are supplemented by national standards for micro-entities and cooperatives. We conclude that it will be difficult to achieve material harmonization in GLASS countries due to a lack of trained accountants, unreliable enforcement systems, and competing institutional logics of taxation systems, banks and insurance companies.

JEL Codes:

• M41
• M48
• O54
• O57

Keywords:

• Latin America
• IFRS
• Accounting harmonization
• Change
• Resistance

Notes

1 This acronym also refers to accounting standards issued by the International Accounting Standards Board (IASB).

2 http://media.ifrs.org/2014/Trustees/October/GLASS%20Presentation%20English%202014.pdf, accessed 3 December 2016.

3 http://glenif.org/es/, accessed 20 November 2016.

4 http://www.ifrs.org/Use-around-the-world/Documents/Jurisdiction-profiles, accessed 20 December 2016.

5 Argentina has 23 provinces and one equivalent province (the autonomous city of Buenos Aires).

6 http://www.cpcesfe1.org.ar/resol-CS/RT24%20NormContcooperat%20JGmarzo08%20pararesol.pdf, accessed 3 January 2017.

7 Irvine (2008) concluded that the World Bank was an important source of coercive isomorphism in the United Arab Emirates.

8 “Brazil cost” refers to the increased operating costs associated with doing business in Brazil. Several factors contribute to the extra cost: high levels of public deficits, the operation of cartels, inefficient public services, high real interest rates, excessive bureaucracy for importers and exporters, low education levels, and a lack of qualified labour.