Title: International financial reporting standards adoption and accounting quality: evidence from Ghanaian listed firms

Authors: Benjamin Yeboah; Cláudio Pais

Addresses: Accountancy Department, Kumasi Technical University, P.O. Box 854, Kumasi, Ashanti, Ghana; Accountancy Department, Instituto Universitário de Lisboa (ISCTE-IUL), Avenida das Forças Armadas, 1649-026, Lisboa, Portugal ' Accountancy Department, Instituto Universitário de Lisboa (ISCTE-IUL), Avenida das Forças Armadas, 1649-026, Lisbon, Portugal

Abstract: The adoption of International Financial Reporting Standards (IFRS) by Ghanaian listed firms form the basis of higher accounting quality and reliability of accounting information from IFRS application. Existing literature suggests that the adoption affects the level of accounting quality. The aim of this paper is to examine whether the shift to IFRS minimises weaknesses in Ghana National Accounting Standards (GNAS) in measuring accounting quality. The paper employs research design metrics of discretional accruals, accrual quality, earnings smoothness, small loss avoidance and price-earnings to compute accounting quality of Ghana Stock Exchange (GSE) firms. The results suggest that accounting quality has improved after the shift to IFRS. This research fills the gap in Ghana level, given that there was no such study. Also, this study gives evidence of improvement in the information environment of GSE capital market after the shift in terms of information quality and accounting comparability.

Keywords: IFRS adoption; accounting quality; earnings management; Ghana.

DOI: 10.1504/AAJFA.2021.117724

Afro-Asian Journal of Finance and Accounting, 2021 Vol.11 No.4, pp.490 - 517

Received: 20 Nov 2017
Accepted: 10 Dec 2018
Published online: 23 Sep 2021 *

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