IDEAS home Printed from https://ideas.repec.org/a/bla/acctfi/v60y2020i3p2585-2615.html
   My bibliography  Save this article

IASB's independence in the due process: an examination of interest groups’ influence on the development of IFRS 9

Author

Listed:
  • Samindi Ishara Hewa
  • Rajni Mala
  • Jinhua Chen

Abstract

This mixed‐method study examines whether and how the International Accounting Standards Board (IASB) was influenced by interest groups during the development of the expected credit loss (ECL) model for IFRS 9 Financial Instruments. Content analysis of 327 comment letters revealed that the IASB was influenced. However, Fisher's exact test and chi‐square goodness‐of‐fit test showed that, to a greater extent, the influence was not significant. Furthermore, qualitative analyses of the arguments put forward by interest groups showed that as a result of interest groups’ inputs, accounting requirements for the ECL model were made more operational, less complex and potentially productive of more comparable financial information.

Suggested Citation

  • Samindi Ishara Hewa & Rajni Mala & Jinhua Chen, 2020. "IASB's independence in the due process: an examination of interest groups’ influence on the development of IFRS 9," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 60(3), pages 2585-2615, September.
    • Handle: RePEc:bla:acctfi:v:60:y:2020:i:3:p:2585-2615
    DOI: 10.1111/acfi.12426
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/acfi.12426
    Download Restriction: no
    File URL: https://libkey.io/10.1111/acfi.12426?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Georgiou, George, 2010. "The IASB standard-setting process: Participation and perceptions of financial statement users," The British Accounting Review, Elsevier, vol. 42(2), pages 103-118.
    2. Ann Jorissen & Nadine Lybaert & Raf Orens & Leo Van Der Tas, 2012. "Formal Participation in the IASB's Due Process of Standard Setting: A Multi-issue/Multi-period Analysis," European Accounting Review, Taylor & Francis Journals, vol. 21(4), pages 693-729, December.
    3. Alain Burlaud & Bernard Colasse, 2011. "International Accounting Standardisation : Is Politics Back ?," Post-Print halshs-00665494, HAL.
    4. Okamoto, Noriaki, 2017. "Norm entrepreneur lobbying and persuasion: A case study involving the IASB's modification of an exposure draft," Research in Accounting Regulation, Elsevier, vol. 29(2), pages 129-138.
    5. Alan Richardson & Burkard Eberlein, 2011. "Legitimating Transnational Standard-Setting: The Case of the International Accounting Standards Board," Journal of Business Ethics, Springer, vol. 98(2), pages 217-245, January.
    6. Cortese, Corinne L. & Irvine, Helen J. & Kaidonis, Mary A., 2010. "Powerful players: How constituents captured the setting of IFRS 6, an accounting standard for the extractive industries," Accounting forum, Elsevier, vol. 34(2), pages 76-88.
    7. Ronita Ram & Susan Newberry, 2013. "IFRS FOR SMEs: THE IASB'S DUE PROCESS," Australian Accounting Review, CPA Australia, vol. 23(1), pages 3-17, March.
    8. Corinne L. Cortese & Helen J. Irvine & Mary A. Kaidonis, 2010. "Powerful players: How constituents captured the setting of IFRS 6, an accounting standard for the extractive industries," Accounting Forum, Taylor & Francis Journals, vol. 34(2), pages 76-88, June.
    9. Alain Burlaud & Bernard Colasse, 2011. "International Accounting Standardisation: Is Politics Back?," Post-Print halshs-02145367, HAL.
    10. Kees Camfferman, 2015. "The Emergence of the 'Incurred-Loss' Model for Credit Losses in IAS 39," Accounting in Europe, Taylor & Francis Journals, vol. 12(1), pages 1-35, June.
    11. Urska Kosi & Antonia Reither, 2014. "Determinants of Corporate Participation in the IFRS 4 (Insurance Contracts) Replacement Process," Accounting in Europe, Taylor & Francis Journals, vol. 11(1), pages 89-112, June.
    12. Donna L. Street, 2012. "IFRS in the United States: If, When and How," Australian Accounting Review, CPA Australia, vol. 22(3), pages 257-274, September.
    13. Begoña Giner & Miguel Arce, 2012. "Lobbying on Accounting Standards: Evidence from IFRS 2 on Share-Based Payments," European Accounting Review, Taylor & Francis Journals, vol. 21(4), pages 655-691, December.
    14. Bengtsson, Elias, 2011. "Repoliticalization of accounting standard setting—The IASB, the EU and the global financial crisis," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 22(6), pages 567-580.
    15. Sutton, Timothy G., 1984. "Lobbying of accounting standard-setting bodies in the U.K. and the U.S.A.: A Downsian analysis," Accounting, Organizations and Society, Elsevier, vol. 9(1), pages 81-95, January.
    16. Kevin M. Stevenson, 2012. "Financial reporting: Hearing the GFC message? What message?," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 52(1), pages 9-20, March.
    17. Marek Reuter & Martin Messner, 2015. "Lobbying on the integrated reporting framework," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 28(3), pages 365-402, March.
    18. Duh, Rong-Ruey & Hsu, Audrey Wen-hsin & Alves, Paulo Alexandre Pimenta, 2012. "The impact of IAS 39 on the risk-relevance of earnings volatility: Evidence from foreign banks cross-listed in the USA," Journal of Contemporary Accounting and Economics, Elsevier, vol. 8(1), pages 23-38.
    19. Holger Erchinger, 2012. "IFRS in the United States – Developments and Current Status," Australian Accounting Review, CPA Australia, vol. 22(3), pages 248-256, September.
    20. Stewart Jones & Sheikh F. Rahman & Peter W. Wolnizer, 2004. "Accounting Reform in Australia: Contrasting Cases of Agenda Building," Abacus, Accounting Foundation, University of Sydney, vol. 40(3), pages 379-404, October.
    21. Robert K. Larson, 2007. "Constituent Participation and the IASB's International Financial Reporting Interpretations Committee," Accounting in Europe, Taylor & Francis Journals, vol. 4(2), pages 207-254, December.
    22. Alain Burlaud & Bernard Colasse, 2011. "International Accounting Standardisation: Is Politics Back?," Accounting in Europe, Taylor & Francis Journals, vol. 8(1), pages 23-47, June.
    23. Bamber, Matthew & McMeeking, Kevin, 2016. "An examination of international accounting standard-setting due process and the implications for legitimacy," The British Accounting Review, Elsevier, vol. 48(1), pages 59-73.
    24. Keryn Chalmers & Jayne M. Godfrey & Barbara Lynch, 2012. "Regulatory theory insights into the past, present and future of general purpose water accounting standard setting," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 25(6), pages 1001-1024, July.
    25. Dean Katselas & Jacqueline Birt & Xin Hao Kang, 2011. "International Firm Lobbying and ED 8 Operating Segments," Australian Accounting Review, CPA Australia, vol. 21(2), pages 154-166, June.
    26. repec:dau:papers:123456789/7512 is not listed on IDEAS
    27. Justin Chircop & Paraskevi Vicky Kiosse, 2015. "Why did preparers lobby to the IASB's pension accounting proposals?," Accounting Forum, Taylor & Francis Journals, vol. 39(4), pages 268-280, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bamber, Matthew & McMeeking, Kevin, 2016. "An examination of international accounting standard-setting due process and the implications for legitimacy," The British Accounting Review, Elsevier, vol. 48(1), pages 59-73.
    2. Karen Handley & Elaine Evans & Sue Wright, 2020. "Understanding participation in accounting standard‐setting: the case of AASB ED 192 Revised Differential Reporting Framework," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 60(4), pages 3621-3645, December.
    3. Roland Königsgruber, 2013. "Expertise-based lobbying and accounting regulation," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 17(4), pages 1009-1025, November.
    4. Urska Kosi & Antonia Reither, 2014. "Determinants of Corporate Participation in the IFRS 4 (Insurance Contracts) Replacement Process," Accounting in Europe, Taylor & Francis Journals, vol. 11(1), pages 89-112, June.
    5. Molina Sánchez, Horacio & Bautista Mesa, Rafael, 2018. "La participación en el /Participation in the IASB Due Process," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 36, pages 429-458, Mayo.
    6. Bailey, Wendy J. & Sawers, Kimberly M., 2018. "Moving toward a principle-based approach to U.S. accounting standard setting: A demand for procedural justice and accounting reform," Advances in accounting, Elsevier, vol. 43(C), pages 1-13.
    7. Raffaele Fiume & Tiziano Onesti & Valerio Pieri, 2013. "Dialogue with standard setters," FINANCIAL REPORTING, FrancoAngeli Editore, vol. 2013(3-4), pages 169-189.
    8. Hervé Kohler & Anne Le Manh, 2014. "Etude Exploratoire De La Participation Au « Due Processus » De L'Iasb De L'Industrie Des Telecommunications, Dans Le Cadre Du Projet « Revenue Recognition »," Post-Print hal-01899618, HAL.
    9. Stenka, Renata & Jaworska, Sylvia, 2019. "The use of made-up users," Accounting, Organizations and Society, Elsevier, vol. 78(C).
    10. Bhimani, Alnoor & Bond, David & Sivabalan, Prabhu, 2019. "Does greater user representation lead to more user focused standards? An empirical investigation of IASB’s approach to standard setting," LSE Research Online Documents on Economics 91196, London School of Economics and Political Science, LSE Library.
    11. Molina Sánchez, Horacio & Mora Enguídanos, Araceli, 2015. "Cambios conceptuales en la contabilidad de los arrendamientos: retos normativos y académicos," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 18(1), pages 99-113.
    12. Roland Königsgruber & Stefan Palan, 2015. "Earnings management and participation in accounting standard-setting," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 23(1), pages 31-52, March.
    13. Marius Gros & Daniel Worret, 2016. "Lobbying and Audit Regulation in the EU," Accounting in Europe, Taylor & Francis Journals, vol. 13(3), pages 381-403, September.
    14. Paola Ramassa & Alberto Quagli, 2024. "Interpreting IFRS: The Evolving Role of Agenda Decisions," Abacus, Accounting Foundation, University of Sydney, vol. 60(2), pages 205-235, June.
    15. Okamoto, Noriaki, 2017. "Norm entrepreneur lobbying and persuasion: A case study involving the IASB's modification of an exposure draft," Research in Accounting Regulation, Elsevier, vol. 29(2), pages 129-138.
    16. Barbara Masiello & Nicola Moscariello & Pietro Fera, 2018. "Political Marketing Strategies to Foster the Sustainability of Private Transnational Organisations: The Case of the IASB," Sustainability, MDPI, vol. 10(8), pages 1-16, July.
    17. Beaumont, Stacey & Clarkson, Peter & Tutticci, Irene, 2018. "Identifying lobbying strategies: An analysis of public responses to the Productivity Commission Inquiry into executive remuneration in Australia," Journal of Contemporary Accounting and Economics, Elsevier, vol. 14(3), pages 288-306.
    18. Hughes, Susan B. & Larson, Robert K. & Sander, James F. & Xiques, Glenn, 2017. "Difficulties converging US GAAP and IFRS through joint projects: The case of business combinations," Advances in accounting, Elsevier, vol. 39(C), pages 1-20.
    19. Rey, Andrea & Maglio, Roberto & Rapone, Valerio, 2020. "Lobbying during IASB and FASB convergence due processes: Evidence from the IFRS 16 project on leases," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 41(C).
    20. Kohler, Hervé & Pochet, Christine & Le Manh, Anne, 2021. "Auditors as intermediaries in the endogenization of an accounting standard: The case of IFRS 15 within the telecom industry," Accounting, Organizations and Society, Elsevier, vol. 91(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:acctfi:v:60:y:2020:i:3:p:2585-2615. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/aaanzea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.