Compliance with consolidation (group) accounting standards – the vertical adjustment issue: Field studies of multi-nationals
2007 (English)In: International Journal of Accounting, Auditing and Performance Evaluation, ISSN 1740-8008, Vol. 4, no 6, 650-665 p.Article in journal (Refereed) Published
Compliance with accounting standards is a major issue in Europe and elsewhere. Research on the horizontal dimension shows non-compliance even though financial reports state compliance and auditors concur. The vertical dimension is more relevant to discover the extent and reasons for non-compliance. Previous research shows that financial executives of multi-nationals indicated non-compliance when asked directly, even though financial reports and auditors state compliance. This follow-on study uses field-studies of subsidiaries of multi-nationals in three countries to explore the extent and reasons for non-compliance for vertical adjustments when consolidating. The method of agreement and method of differences were used to analyse data. Results show substantial non-compliance and some reasons for non-compliance, notably income smoothing. The vertical dimension is appropriate for continued research and this study provides a model for similar research.
Place, publisher, year, edition, pages
2007. Vol. 4, no 6, 650-665 p.
accounting standards compliance, consolidated financial reporting, consolidation process, group accounting, subsidiary reporting, vertical adjustments, multinational subsidiaries, income smoothing
Economics and Business
IdentifiersURN: urn:nbn:se:umu:diva-10721DOI: 10.1504/IJAAPE.2007.017459OAI: oai:DiVA.org:umu-10721DiVA: diva2:150392