Hail, Procrustes! Harmonized Accounting Standards as a Procrustean Bed
Posted: 11 Jan 2007 Last revised: 25 Jul 2012
Date Written: July 14, 2012
This article finds that the use of a harmonized accounting standard, such as the International Financial Reporting Standards, increases the information available to markets only if institutional differences across countries using the harmonized standard are insignificant. In all other cases, harmonization of reporting standards destroys information rather than increasing it. This article also contributes to methodology, introducing techniques for studying non-partitional information structures.
Keywords: IFRS, accounting harmonization, non-partitional information structures, convergence
JEL Classification: M41, G15, D83, C65
Suggested Citation: Suggested Citation