Optional Accounting Criteria under IFRSs and Corporate Charasteristics: Evidence from Spain Articles uri icon

publication date

  • December 2011

start page

  • 59

end page

  • 85


  • 14


  • 1

International Standard Serial Number (ISSN)

  • 1138-4891

Electronic International Standard Serial Number (EISSN)

  • 1988-4672


  • The adoption of the IFRSs by EU member States in 2005 represents one of the most relevant events that have taken place to achieve the convergence of international accounting standards. In this article, we examine the annual reports of the groups listed on the Spanish Continuous Market that adopted I RSs in 2005 in order to determine the optional accounting criteria they apply under IFRSs and, secondly, identify corporate characteristics affecting these choices. Because there are important differences across countries as a consequence of different institutional frameworks, the mandatory IFRSs adoption is an opportunity to analyze its economic effects. The main finding of this study is that Spanish groups apply the most conservative criteria to limit the number of changes they introduce related to the previous local GAAP, particularly in regards to presentation and measurement options. Additionally, we find that corporate characteristics such as industry, return on equity, size and type of audit firm (Big Four vs. non-Big Four) influence the choice of accounting methods used to prepare their financial statements. The analysis of these results provides a basis for discussion between responsible international standard setters (such as IASB and FASB) and regulators to work towards the convergence's goals.