Accounting and Finance to lead new research on the impact of International Financial Reporting Standards (IFRS)
Published 10 August 2006
The Department of Accounting and Finance has been successful in its bid for a new European Commission-funded Marie Curie Research Training Network, involving ten universities from across Europe. The INTACCT Network will receive funding totalling over €2 million over a four-year period commencing January 2007.
Professor Peter Pope will lead the Lancaster group and will act as Network coordinator in developing doctoral training opportunities and research initiatives exploring issues relating to the introduction of International Financial Reporting Standards (IFRS) across Europe.
Since 2005, the EU has required public listed European companies to prepare financial statements using IFRS instead of the country-specific accounting rules used in the past. This development is a key element in the creation of an integrated market in financial services. Harmonisation of financial reporting around IFRS should increase the comparability of corporate financial performance and lead to considerably greater financial transparency and accountability. Potential benefits that are claimed to result from this new financial reporting environment include a reduction in firms’ cost of capital, enhanced investor protection, and better informed stakeholders, including creditors and employees. If these predictions are correct, then the efficiency of the European economy could improve significantly.
However, it is possible that the benefits from IFRS adoption might have been overestimated and potential costly consequences might have been underestimated. Moreover, benefits from IFRS will only be realized if compliance can be assured. However, effective enforcement is by no means guaranteed and professional accounting bodies and accounting academics have already warned of potential compliance problems. These concerns create a strong rationale for establishing the Network to drive forward research into the establishment and operation of financial reporting regulation.
Partner universities are: Tilburg University (Netherlands), J W Goethe University Frankfurt (Germany), HEC School of Management (France), University of Valencia (Spain), University of Cyprus, University of Porto (Portugal), University of Ljubljana (Slovenia), Varna University of Economics (Bulgaria) and University of Macedonia of Economic & Social Sciences (Greece). Many of Europe's leading accounting and finance researchers will be involved in the training and research activities of the network.
Further information may be obtained by contacting the Department of Accounting and Finance at +44 (0)1524 593622 or email: j.hughes5@lancaster.ac.uk.
