Pressures and conflicts in moving towards harmonization of accounting practice: the Hungarian experience

Abstract

The new accounting law in Hungary has been operational since the start of 1992. Previous publications have set out a range of factors which may have influenced the shaping or the application of the law. This paper reports the results of a joint Hungarian/UK pilot initiative to explore by interview methods the perceptions of Hungarian entrepreneurs and of non-nationals working in Hungary, as regards the various influences on the development of the law and the potential users of the financial statements produced. The investigation was undertaken during 1993 when there had been an opportunity for most enterprises to experience a full business year using the law. Although the law has been written to comply broadly with the Fourth Directive of the EC, there remain some aspects of the Fourth Directive which might be regarded from a UK perspective as not having been fully implemented, particularly in relation to provisions. The paper concludes that while the impact of the move to the market economy is a visible factor, both in the drafting of the law and in the perceptions of the likely users of the financial statements, the influence of state regulation remains, particularly in the context of the continuing perceived impact of fiscal policy on accounting regulation.

Convergence with IFRS in an expanding Europe: progress and obstacles identified by large accounting firms’ survey

“…Rahman et al (2002) empirically support the idea that regulatory harmony can improve practice harmony. However, the EU regulation mandating IFRS adoption by listed Sucher, Seal, and Zelenka (1996), Holeckova (1996), Seal, Sucher, and Zelenka (1995) Bailey, Alver, Mackevicius, and Paupa (1995) Rooz, Sztano, and Sztano (1996); Clarkson, Fraser, Iles, and Weetman (1996), Boross, Clarkson, Fraser, and Weetman (1995) Bailey et al…”

Change and choice in Hungarian accounting practice

“…Various authors have compared the Law with the Fourth Directive (Arthur Andersen, 1993;Tornpa, 1993;Borda, 1995;Boross et al, 1995) while there have also been comparisons of the Law with previous practices in Hungary (Coopers and Lybrand, 1992;Arthur Andersen, 1993;Boross et al, 1995). From these comparisons emerge three recurring themes which bring out the potential impact of change for individuals practising accounting in business enterprises.…”

“…Drawing on these sources for a list of factors perceived to be influencing the Law and the development of new accounting practice, a pilot study by Boross et al (1995) used questionnaire and interview methods to establish a ranking where the four most important influences on the development of the Law were seen to be (in descending order): fiscal policy and tax collecting; the move to EC membership; the need to attract foreign capital investment; and the presence of experts from international accountancy firms. That list of factors is predominantly macroeconomic in nature and gives few clues as Downloaded by [Queensland University of Technology] at 12:57 13 October 2014 to how individual accountants and individual companies might react to the choices permitted by the Accounting Law of 1991.…”

Comparability of Company Accounts Using IFRS and US GAAP: Empirical Evidence of European and US Financial Statements

“…From the '90s until the adoption of IFRS in 2005, comparative studies have focused on two different issues: 1) the study of the relationship between differences in accounting practices and share-price returns in international capital markets (Meek, 1991;Amir, Harris, & Venuti, 1993;Pope & Rees, 1992;Bandyopadhyay, Hanna, & Richardson, 1994;Harris, Lang, & Moller, 1994;Barth & Clinch 1996;Rees & Elgers, 1997;Harris & Mueller, 1999;Adam, Weetman, & Gray 1993;Alford, Jones, Leftwich, & Zmijewski, 1993;Hellman, 1993;Rahman, Perera, & Tower, 1994;Saudagaran & Meek 1997;Weetman, Jones, Adams, & Gray, 1998, Aboody Barth, & Kasnik, 1999Pownall & Schipper, 1999;Guenther & Young, 2000;Hung, 2000;Schipper, 2000;Asbaugh & Pincus, 2001;Asbaugh & Olsson, 2002;Dumontier & Raffournier, 2002;Bhattacharya, Daouk, & Welker, 2003, Leuz, 2003Bradshaw, Bushee, & Miller, 2004) and 2) IFRS/US GAAP comparison (Bhoocha & Stansell, 1990;Meek & Saudagaran, 1990;Nobes, 1990;Biddle & Saudgaran, 1991;Choi & Levich, 1991;Cooke, 1993;Grove & Bazley, 1993;Frost & Pownell, 1994;Yang & Lee, 1994;Boross, Clarkson, Fraser, &Weetman, 1995;Roberts, Salter, & Kantor, 1995;Schweikart, Gray, & Salter, 1996;…”