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Individual investors’ attitudes toward the acceptance of International Financial Reporting Standards in the United States

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  • McEnroe, John E.
  • Sullivan, Mark

Abstract

As of this writing, non-U.S. companies using International Financial Reporting Standards (IFRS) are permitted to list their securities on U.S. stock exchanges without reconciling those statements to U.S. Generally Accepted Accounting Principles (U.S. GAAP). The Securities and Exchange Commission (SEC) is currently considering a proposed rule that would require all U.S. issuers to employ IFRS by 2015. SEC Commissioner Elisse Walter has emphasized that IFRS should be incorporated into U.S. capital markets only if the change benefits U.S. investors. Current Chairperson Mary Schapiro more recently echoed this statement. Accordingly, this paper reports on the results of a survey of individual investors’ attitudes toward this potential change. It concludes that U.S. investors are satisfied with the current U.S. accounting model and do not desire a movement toward the adoption of IFRS.

Suggested Citation

  • McEnroe, John E. & Sullivan, Mark, 2011. "Individual investors’ attitudes toward the acceptance of International Financial Reporting Standards in the United States," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 20(1), pages 20-31.
    • Handle: RePEc:eee:jiaata:v:20:y:2011:i:1:p:20-31
    DOI: 10.1016/j.intaccaudtax.2010.12.002
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    References listed on IDEAS

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    1. Maroney, James J. & McGarry, Clodagh & Ó hÓgartaigh, Ciarán, 2008. "Familiarity, home bias and investors’ reactions to 20-F reconciliation gains and losses and perceptions of the quality of accounting principles," The British Accounting Review, Elsevier, vol. 40(2), pages 103-122.
    2. Krishnamoorthy, Ganesh & Maroney, James J. & Ó hÓgartaigh, Ciarán, 2008. "20-F reconciliations and investment recommendations by financial professionals," Journal of Business Research, Elsevier, vol. 61(4), pages 355-362, April.
    3. Holger Daske, 2006. "Economic Benefits of Adopting IFRS or US-GAAP - Have the Expected Cost of Equity Capital Really Decreased?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 33(3-4), pages 329-373.
    4. Kam Chan & Samir El-Gazzar & Philip Finn & Rudy Jacob, 2006. "Simultaneous Releases of U.S. and Foreign GAAP Earnings," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 12(2), pages 161-168, May.
    5. Holger Daske, 2006. "Economic Benefits of Adopting IFRS or US‐GAAP – Have the Expected Cost of Equity Capital Really Decreased?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 33(3‐4), pages 329-373, April.
    6. repec:kap:iaecre:v:12:y:2006:i:2:p:161-168 is not listed on IDEAS
    7. George J. Benston & Michael Bromwich & Alfred Wagenhofer, 2006. "Principles‐ versus rules‐based accounting standards: the FASB's standard setting strategy," Abacus, Accounting Foundation, University of Sydney, vol. 42(2), pages 165-188, June.
    8. Darnell F. Hawkins, 1975. "Estimation of Nonresponse Bias," Sociological Methods & Research, , vol. 3(4), pages 461-488, May.
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    Cited by:

    1. Guerreiro, Marta Silva & Rodrigues, Lúcia Lima & Craig, Russell, 2012. "Factors influencing the preparedness of large unlisted companies to implement adapted International Financial Reporting Standards in Portugal," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 21(2), pages 169-184.
    2. McEnroe, John E. & Sullivan, Mark, 2013. "An examination of the perceptions of auditors and chief financial officers regarding principles versus rules based accounting standards," Research in Accounting Regulation, Elsevier, vol. 25(2), pages 196-207.
    3. Lueg, Rainer & Punda, Pawel & Burkert, Michael, 2014. "Does transition to IFRS substantially affect key financial ratios in shareholder-oriented common law regimes? Evidence from the UK," Advances in accounting, Elsevier, vol. 30(1), pages 241-250.
    4. Grossman, Amanda M. & Smith, L. Murphy & Tervo, Wayne, 2013. "Measuring the impact of international reporting standards on market performance of publicly traded companies," Advances in accounting, Elsevier, vol. 29(2), pages 343-349.
    5. Yong, Kevin Ow & Lim, Chu Yeong & Tan, Pearl, 2016. "Theory and practice of the proposed conceptual framework: Evidence from the field," Advances in accounting, Elsevier, vol. 35(C), pages 62-74.

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