The voluntary adoption of IAS/IFRS by private entities

2 PM
Room 3E, Department of Economics and Management

Speaker:

• Paola Rossi, University of Trento

Abstract:
The EU Regulation 1606/2002 enhanced the financial statement comparability by requiring the IFRS mandatory application. In Italy, the implementation of EU regulation stated that listed firms are required to prepare their financial statements in accordance with IFRS, then extended to private entities on a voluntary basis. The study examines the extent to which the change from Italian GAAP to IFRS has affected Italian SMEs. The results suggest that profit and equity reported under IFRS is higher than that reported under Italian GAAP: the Gray's partial analysis indicate that the most relevant and frequent impacts are caused by the adoption of IAS 38, IAS 16, IAS 19, IAS 17, IAS 39 and IAS 18. This study can inform companies and policy makers of the consequences of IFRS adoption in those countries which intend to expand the application of IFRS more widely to smaller companies.