Bridging the Gap: How Polish GAAP Aligns with International GAAP

Purpose: The purpose of the article is to examine the scope of support by the Polish accounting regulation system (here referred to as Polish GAAP) for International Financial Reporting Standards (IFRS, here referred to as International GAAP), in the preparation of financial statements in accordance with them. IFRS currently does not cover not only the organizational issues of the accounting systems on the basis of which these statements are prepared, but also some substantive issues, such as business combinations under common control, divisions of entities, preparation of financial statements when the assumption of going concern is not met. These issues are covered by Polish GAAP. However, the problem is whether, in the light of paragraphs 10 and 11 of IAS 8, it is possible to apply it directly. Design/Methodology/Approach: In the study on the presented research problem, natural research methods based on deductive reasoning were used. Due to the thematic scope of the study, the basic one, apart from the method of analysis and criticism of literature, is the method of analysis and logical construction, supported by the method of examining documents, here: the content of IAS 8 and the Accounting Act. Findings: The conducted study indicates the ambiguity and resulting difficulty in the practical application of the provision contained in the Accounting Act, which is the foundation of the Polish regulatory system of financial reporting, when preparing financial statements in accordance with IFRS, approved for use in the European Union. This ambiguity may lead to a differentiated approach to issues that, although not regulated in IFRS, are regulated in the Polish accounting system. Practical Implications: Considering the coexistence of three pillars of accounting, theoretical, regulatory and application, these practical implications in the area of preparing financial statements in accordance with IFRSs approved for use in the EU are related to, the scientific dimension – to the need to conduct empirical research that would confirm (or not) the scale of the occurrence of a diverse approach to understanding and applying the provision of art. 2.3 of the Accounting Act, and thus a non-uniform approach that does not contribute to ensuring the comparability of the financial statements prepared; the regulatory dimension – to the need to clarify the content of art. 2.3 of the Accounting Act or to issue an appropriate interpretation of this provision in order to avoid the consequences indicated above; the application dimension – to the need or at least to take into consideration in the selection of the entity's accounting policy in the area of issues not covered by IFRS, the provisions of the Polish accounting regulatory system, which includes such issues as business combinations under common control or preparation of financial statements when the assumption of going concern is not met. Originality: The problem raised in the article has not been the subject of in-depth research and analysis, both at the level of academic research and practical research – regulatory and application. On this basis, the author expresses the opinion that it is a unique study.