The Role and Current Status of IFRS in the Completion of National Rules – Evidence from Greece

Abstract

Law 4308/2014 is the main regulation that transposed Accounting Directive 2013/34 of the EU into national law in Greece. This short paper summarises the underlying background and the process followed up to the issuance of this Law. It also outlines the key accounting principles introduced with this Law and how they compare with IFRS. This brief analysis indicates that, to a large extent, Greek accounting standards have now been aligned with IFRS. Given the preceding substantial differences between Greek accounting Laws and IFRS, this Law introduced significant changes to the accounting environment for non-listed companies in Greece, aiming at improving accounting quality and enhancing accounting comparability between listed and non-listed companies.

Keywords:

• accounting directive 2013/34/EU
• law 4308/2014
• Greece
• IFRS

Acknowledgements

I gratefully acknowledge helpful comments received from the Editor (Paul André) and Dionysia Dionysiou. I am also grateful to Ms Nosi, director within the department of standing committees in the Greek Parliament, who offered me access to the minutes of the parliamentary standing committee on economic affairs that discussed the draft bill of Law 4308/2014. The paper was written during my research visit at Cyprus University of Technology.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Ioannis Tsalavoutas http://orcid.org/0000-0002-4043-3156

Notes

1 Full title: Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC Text with EEA relevance.

2 http://eur-lex.europa.eu/legal-content/EN/NIM/?uri=CELEX:32013L0034

3 Interested readers can download the Law via the website of the Government Gazette by choosing 2014 in the first tab and type the Law number (4308) in the second tab here: http://www.et.gr/index.php/2013-01-28-14-06-23/search-laws

4 This Law is accessible by following the corresponding process described regarding Law 4308/2014 earlier.

5 This Law is accessible by following the corresponding process described regarding Law 4308/2014 earlier.

6 It is worth noting that this Law also transposed into national Law the Directive 2014/95/EU of the European Parliament and of the Council of 15 November 2014 with regard to non-financial reporting related matters.

7 This Law is accessible by following the corresponding process described regarding Law 4308/2014 earlier.

8 The full Greek name of ELTE is Επιτροπή Λογιστικής Τυποποίησης και Ελέγχων – ΕΛΤΕ (Epitropi Logistikis Typopiisis kai Elegchon – ELTE), which translates as the Accounting Standardisation and Auditing Committee).

9 Interested readers can obtain a full overview of the responsibilities and activities of ELTE by accessing its website (http://elte.org.gr/index.php?lang=en) and reading Caramanis, Dedoulis, and Leventis (2015) as a supplementary source.

10 The full Greek name of SLOT is Συμβούλιο Λογιστικής Τυποποίησης – ΣΛΟΤ (Symvoulio Logistikis Typopiisis – SLOT).

11 Mentioned by Mr Mavraganis (deputy minister of finance at the time) during the discussion of the bill at the first meeting of the parliamentary standing committee on economic affairs (minutes of the meeting held on 13 November 2014). See also the corresponding page in the official website which lists bills for consultation: http://www.opengov.gr/minfin/?p=4846. It is noted that, during the same meeting, one member of parliament (Ms Theodora Tzakri) refers to a corresponding draft bill that became publicly available as early as November 2013. However, she did not make clear whether the draft bill she referred to related to the same draft bill that Markazos (2014) refers to and aimed at tackling the tax-related reforms incorporated in Law 4308/2014 eventually – see below.

12 This Law succeeded the Commercial law adopted in 1835 which was heavily based on the French Code (Tsalavoutas, 2009, p. 33).

13 The implementation of the 7th Directive came into force in 1990. There was no previous legal requirement for group accounts (Papas, 1993).

14 Ballas et al. (1998) highlight the significant differences in the objectives of the Greek and French accounting plans: in France these objectives were largely the collection of macro-economic data while it served fiscal objectives in Greece.

15 This Law is accessible by following the corresponding process described regarding Law 4308/2014 earlier.

16 This Law is known/entitled as Κώδικας Φορολογικής Απεικόνισης Συναλλαγών, which translates as Code of Transactions’ Tax Display.

17 Relevant material (in Greek) can be accessed via the website of the Greek Parliament: http://www.parliament.gr/Nomothetiko-Ergo/Anazitisi-Nomothetikou-Ergou?law_id=ac2b58c1-02d7-4066-b265-a3e000ba104f

18 The term IFRS was used 12 times throughout the three-hour discussion.

19 The term IFRS was used 29 times throughout the two-hour discussion.

20 The minutes (in Greek) of the corresponding Parliamentary hearing are available here (pp. 1792–1808; 1811–1814; 1998–2005; 2085): http://www.parliament.gr/UserFiles/a08fc2dd-61a9-4a83-b09a-09f4c564609d/es20141119.pdf http://www.parliament.gr/UserFiles/a08fc2dd-61a9-4a83-b09a-09f4c564609d/es20141120.pdf

21 http://www.kodiko.gr/nomologia/document_navigation/103288/pol-1003-2014 http://www.publicrevenue.gr/kpi/public/blog/attach/files/rss/pol_1024_2015.pdf

22 http://www.elte.org.gr/images/files/pdf/Ellinika-Logistika-Protipa/Logistiki-Odigia-N4308_2014.pdf

23 Tsalavoutas and Evans (2010) report in detail the significant differences between IFRS and Greek accounting standards as at 2005. Analysis of their appendix along with Table 2 here illustrates the significant convergence between the two sets of standards.