Formal Participation in the IASB's Due Process of Standard Setting: A Multi-Issue/Multi-Period Analysis

Posted: 30 Jan 2010

See all articles by Ann Jorissen

Ann Jorissen

University of Antwerp - Department of Accounting & Finance

Nadine Lybaert

Hasselt University

Raf Orens

Catholic University of Louvain (UCL) - Lessius University College

Leo van der Tas

Tilburg University; Ernst & Young, The Netherlands

Date Written: January 27, 2010

Abstract

This paper sets out to enquire the nature of constituents’ participation in the IASB’s due process in terms of representation (constituents’ diversity and characteristics) and drivers to participate. We choose to adopt a multi-issue/multi-period approach to investigate constituents’ formal participation. An analysis of comment letters sent directly to the IASB over the period 2002-2006, reveals that preparers sent most letters followed by the accounting profession and standard setters. With regard to timing, we find that preparers concentrate their participation efforts at a later stage in the process compared to the other constituents, who react earlier. Formal indirect participation in the IASB’s due process by submitting comments letters to EFRAG is infrequently used by European constituents. In those cases where constituents exert influence to both IASB and EFRAG, they often use exactly the same comment letter. Concentrating on the drivers to participate, the data reveal that preparers, accountants and standard setters react significantly more when proposals have a major impact on the accounting numbers of a company. Users, stock exchanges and their supervisory authorities write significantly more comment letters when disclosure issues are at stake. Finally, participating preparers in the IASB’s due process are larger and more profitable than non-participating preparers.

Keywords: IASB, standard setting, IAS/IFRS, lobbying, constituents’ diversity, multi-issue/multi-period approach

JEL Classification: M40, M44

Suggested Citation

Jorissen, Ann and Lybaert, Nadine and Orens, Raf and van der Tas, Leo, Formal Participation in the IASB's Due Process of Standard Setting: A Multi-Issue/Multi-Period Analysis (January 27, 2010). European Accounting Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1543208

Ann Jorissen (Contact Author)

University of Antwerp - Department of Accounting & Finance ( email )

Prinsstraat 13
Antwerpen, B-2020
Belgium
00 32 3 220 40 92 (Phone)
00 32 3 220 40 64 (Fax)

Nadine Lybaert

Hasselt University ( email )

Agoralaan - building D
Gebouw D
Diepenbeek, 3590
Belgium

Raf Orens

Catholic University of Louvain (UCL) - Lessius University College ( email )

Department of Business Studies
Korte Nieuwstraat 33
Antwerp, 2000
Belgium

Leo Van der Tas

Tilburg University ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands

Ernst & Young, The Netherlands ( email )

Postbus 488
Rotterdam, 3000 AL
Netherlands
+31 88 4075015 (Phone)

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