National Legislative Systems and Foreign Standards and Regulations: The Case of International Financialreporting Standards` Adoption

Abstract

This study is focused on the linkages between the legislative families as descriptors of national legislative systems and International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB). We consider such analysis as a case study for the more general issue of explaining the preferences of national regulators in the adoption of foreign norms, rules, standards and practices. By using a dataset of 162 jurisdictions and dummy variables designed to capture the current stage of IFRSs adoption and, respectively, the taxonomy of their legislative systems, we find that a full IFRSs adoption is more likely to occur in countries which have principles-based on legislative mono-systems. In addition, we observe that a strong rule of law, with an effective mechanism of property rights reinforcement, as well as the pre-adoption existence of a pro-growth set of public policies can contribute to the encouragement of IFRSs adoption.

SaŽetak

Ova studija je fokusirana na veze između zakonodavnih okvira kao deskriptora nacionalnih zakonodavnih sustava i Međunarodnih standarda financijskog izvješćivanja (MSFI), koje objavljuje Odbor za međunarodne računovodstvene standarde (IASB). Takve analize se razmatraju kao studije slučaja za šira pitanja u objašnjenju preferencija nacionalnih vlasti u usvajanju stranih normi, propisa, standarda i praksi. Korištenjem skupa podataka od 162 pravne i dummy varijable, osmišljene za dostizanje trenutne faze usvajanja MSFI-a, odnosno, taksonomije njihovih zakonodavnih sustava, smatra se da će se puna primjena MSFI-a vjerojatnije dogoditi u zemljama koje svoja načela temeljena zakonskim monosustavima. Osim toga, primjetno je da snažna vladavina prava,uzučinkovit mehanizam jačanja imovinskih prava, kao i prethodno donošenje skupa javnih politika rasta, može pridonijeti poticanju usvajanja MSFI-a.

Key words:

• IFRSs adoption
• legislative families
• Rule of law
• Growth

Ključne riječi::

• Usvajanje MSFI-a
• Zakonodavni okviri,
• Vladavina prava
• Rast

JEL classification::

• K49
• M48