Evidence of impaired compliance and regulation in IFRS-based financial reporting

Tyrone Carlin, Nigel Finch

Research output: Contribution to journalConference paperpeer-review


The transition to IFRS based reporting has resulted in fundamental departures from many of the long accepted norms embedded in indigenous GAAP systems now superseded in IFRS adopting jurisdictions. The rules relating to goodwill accounting, measurement and reporting represent an excellent case in point, the traditionally dominant capitalise and amortise regime having been disposed of in favour of an impairment testing regime pursuant to which periodic amortisation charges are no longer required. There has been much criticism of this new impairment testing regime, principally along the lines that it results in an increased potential for opportunism in financial statement preparation due to the subjective and unverifiable nature of a range of judgements necessary to the execution of the impairment testing process. In this paper, we add to the extant literature’s catalogue of concerns by documenting systematic non compliance with the disclosure requirements of AASB 136 – Impairment of Assets. We argue that a key problem resulting from this phenomenon is a decline in financial statement comparability. At the policy level, we raise questions as to the implications of the complexity of the IFRS based impairment testing regime both from the preparer and audit perspective.
Original languageEnglish
Pages (from-to)392-410
Number of pages19
JournalGlobal Conference on Business and Finance proceedings
Issue number1
Publication statusPublished - 2009
EventGlobal Conference on Business and Finance - Atlantic City, NJ
Duration: 6 Jan 20099 Jan 2009


  • goodwill
  • impairment
  • financial reporting
  • creative accounting


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