Adoption and Implementation of IFRS in Emerging Economies: A Literature Review of Their Effects on Financial Reporting Quality, Capital Markets, and Institutional Factors
DOI:
https://doi.org/10.71068/gp000002Keywords:
IFRS, emerging economies, financial reporting quality, cost of capital, compliance, literature review.Abstract
The adoption of International Financial Reporting Standards (IFRS) represents one of the most far-reaching regulatory developments in global accounting, with more than 160 jurisdictions committed to their implementation. This article presents a literature review aimed at analyzing the documented effects of IFRS adoption and implementation in emerging economies, as well as the institutional, professional, and market factors that shape these effects. A total of 26 studies published between 2018 and 2022 in indexed scientific journals were examined, prioritizing sources indexed in Scopus, through a thematic coding protocol organized into five categories: financial reporting quality, value relevance, cost of capital and information asymmetry, compliance and enforcement mechanisms, and challenges faced by small and medium-sized enterprises. The results, derived exclusively from the analysis of the reviewed literature, show that the effects of IFRS are heterogeneous: while some studies document improvements in accounting quality and reductions in the cost of capital, others report increases in earnings management and unintended adverse effects. It is concluded that the benefits of adoption critically depend on institutional quality, professional capacity, and enforcement mechanisms, thereby supporting the proposed hypothesis.
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