Impetus to the success of harmonization

The case of South Pacific Island nations

Parmod Chand*

*Corresponding author for this work

Research output: Contribution to journalArticle

36 Citations (Scopus)

Abstract

Several influential actors and regulators in the standard-setting arena have argued in support of international accounting standards as a basis for bringing consistency to financial statements across nations. The need for harmonization is apparent and the forces pushing for harmonization are irresistible, but it can only become a reality as a result of commitment and concerted effort by the regulators, standard setters, financiers, business community, and most importantly, the accountancy profession. Based on a critical perspective, an alternative rationale has been advanced in this paper, which is premised on identifying the impetus to the success of the process of harmonization, identifying the factors which a country should consider before an attempt is made to adopt/adapt the international accounting standard (IASs). In doing so, the study critically evaluates whether the developing countries do have the necessary resources, skills and appropriate reference points in the capital and other markets to harmonize accounting practices. This paper, therefore, seeks to explain what is needed to adopt/adapt the IASs, rather than considering the relevance/irrelevance of these standards, which other studies have done. To achieve success in the harmonization process this paper has provided five strategic factors (professional expertise, education and training, legal backing, the proportion of MNCs and local companies, and adoption of IASs with amendments) a country can use.

Original languageEnglish
Pages (from-to)209-226
Number of pages18
JournalCritical Perspectives on Accounting
Volume16
Issue number3
DOIs
Publication statusPublished - Apr 2005
Externally publishedYes

Keywords

  • Accounting standards
  • Adoption
  • Consequences
  • Harmonization
  • Impetus
  • International accounting standards

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