A comparison of financial reporting systems in four EU states

Level: Undergraduate | Grade: 2.1 | Approx. Word Count: 1,700

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Overview

The adoption of IFRS by the EU was intended to result in the harmonisation of financial reporting standards across all its member states. However, as shown within this comparative essay, due to cultural, political and regulatory differences means that absolute harmonisation remains an issue that has not been completely resolved.

Although originally reluctant to adopt IFRS due to its dominance in the USA, following failures to develop and pass a credible alternative, the EU issued directives that required all corporations in the member states to use IFRS as the financial reporting standard for financial statements from 2005. However, it is apparent from an analysis of the accounting and financial reporting determinants that exists in four diverse EU nations that this has yet to secure the anticipated unanimity of financial reporting.