IFRS adoption and accounting regulation in Ethiopia

Abstract

Purpose

The purpose of this study is to examine international financial reporting standards (IFRSs) adoption in Ethiopia to explain transnational political-economic antecedents of this change and its associated consequences on the regulatory landscape of accounting.

Design/methodology/approach

Using a neo-Gramscian theory of globalization and the state, the study examines interview and document review evidence pertaining to IFRS adoption in Ethiopia by focusing on the period from 1991 to 2014.

Findings

The study illustrates that a dialectical rather than deterministic interaction between global and national forces explains IFRS adoption in Ethiopia, i.e. IFRS adoption falls within the broader scheme of universalizing regulatory institutions in the globalizing world economy. Compared to the commonly understood trends of IFRS adoption circumscribed within a pre-existing regulatory framework, this study illustrates IFRS adoption as a primary driver of major reforms to the accounting regulatory landscape.

Originality/value

This study contributes original theoretically grounded insights into the transnational political-economic rationale for IFRS adoption and consequences of the adoption on the accounting regulatory landscape.

Citation

Wagaw, Y.M., Mihret, D.G. and Obo, D.D. (2019), "IFRS adoption and accounting regulation in Ethiopia", Accounting Research Journal, Vol. 32 No. 4, pp. 662-677. https://doi.org/10.1108/ARJ-02-2017-0033