The effect of IFRS adoption on financial disclosure: does culture still play a role?

Abstract

This study investigates whether the differences in financial disclosure due to culture have diminished after the use of IFRS. Using 498 firm-year observations for the period of 2004 to 2006 from six countries, the results indicate that the effect of culture still prevail on the amount of disclosure even after the use of IFRS. However, it is also noted that, the level of financial disclosure increases in all countries examined following the adoption of IFRS. Nevertheless, findings of the study show that the use of single set of accounting standards does not completely eliminate the impact of culture on financial disclosure.