The Evolution of the European Public Good Assessment in the EU Endorsement Process of IFRS

Hossfeld, Christopher; Muller-Lagarde, Yvonne; Zevounou, Lionel

doi:10.1080/17449480.2020.1818799

Cited by 9 publications

(10 citation statements)

References 16 publications

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“…The rise of the EPG criterion has, therefore, gradually differentiated the objectives of IAS Regulation from the IASB's mission statement. While the IASB considers financial stability, as well as economic and sustainable growth, as (at most) second-order effects of its mission to bring transparency and efficiency to financial markets (Hoogervorst and Prada, 2015), the EPG criterion stresses the importance of macro- and extra-economic targets in terms of economic, social and environmental sustainability, enabling the adaptation of the accounting standardisation process to incorporate broader but not yet fully specified objectives (Palea, 2018; Hossfeld et al , 2020). Thus, the EPG criterion represents a concrete and growing threat to the IASB's independence and forces the global standard-setter to act strategically to maintain its legitimacy in the European arena (Bischof and Daske, 2016).…”

Section: The Rise Of the European Public Good Criterion And The International Accounting Standards Board's Response To Preserve Its Outpumentioning

confidence: 99%

“…2. According to Hossfeld et al . (2020), after the Maystadt report was published, the assessment of whether IFRS is conducive to the EPG (Appendix 3 of the EFRAG endorsement advices) has increased in importance relative to technical considerations.…”

Section: Notesmentioning

confidence: 99%

“…Scholars and practitioners have already stressed the various technical issues associated with the COVID-19 outbreak by examining their impact on accounting and auditing quality (Levy, 2020; Liu et al , 2020). This paper, instead, grounded in the legitimacy theory (Suchman, 1995) and framed within the context of the European Union (EU) endorsement process (Hossfeld et al , 2020), discusses the accounting standard-setting implications of the pandemic in the European institutional setting (Figure 1).…”

Section: Introductionmentioning

confidence: 99%

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Practical expedients and theoretical flaws: the IASB's legitimacy strategy during the COVID-19 pandemic

Moscariello

Pizzo

2021

AAAJ

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PurposeGrounded in the legitimacy theory and framed within the context of European Union’s (EU's) endorsement process, this paper analyses the International Accounting Standards Board’s (IASB's) response to the COVID-19 crisis and the impact of its practical expedient COVID-19-Related Rent Concession on the IASB's output legitimacy.Design/methodology/approachThis study uses a qualitative process-tracing approach and combines inductive historical narratives and deductive reasoning to draw theoretical implications concerning the COVID-19 crisis' impact on the standard-setting process.FindingsThe paper shows a growing reliance on practical expedients in International Financial Reporting Standards (IFRS) to maintain the IASB's output legitimacy. While introducing some theoretical flaws, practical expedients increase the standards' flexibility and strengthen the IASB's ability to respond to the European political bodies' concerns. Indeed, an analysis of the IASB's response to the COVID-19 outbreak reveals the role practical expedients might play not only in reducing (ex ante) new IFRS transition costs but also in dealing (ex-post) with the broader economic impact of unexpected systemic crises to limit criticisms and controversies surrounding IFRS.Originality/valueThis study reveals a causal relationship between the rise of the European public good criterion in the EU endorsement process and the wider use of practical expedients in IFRS. An analysis of the latest amendment to IFRS 16 in response to the COVID-19 crisis also confirms the role of practical expedients in strengthening the acceptance of IFRS in an increasingly complex economic reality and sheds some light on the new strategies adopted by the IASB to preserve its legitimacy in the EU.

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Section: The Rise Of the European Public Good Criterion And The International Accounting Standards Board's Response To Preserve Its Outpumentioning

confidence: 99%

Section: Notesmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Practical expedients and theoretical flaws: the IASB's legitimacy strategy during the COVID-19 pandemic

Moscariello

Pizzo

2021

AAAJ

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“…Prior to this, companies had used voluntary disclosures of sustainability information to address the needs of stakeholders (Venturelli et al, 2022). The sustainability reporting momentum in the European Union and the role of EFRAG is likely going to grow in the future (Giner & Luque-Vílchez, 2022) ensuring European public good (Hossfeld et al, 2020) through IFRS. EFRAG considers more comprehensive perspective than (International Financial Reporting Standards) IFRS Foundation with respect to the materiality and reporting aspects (Giner & Luque-Vílchez, 2022).…”

Section: Introductionmentioning

confidence: 99%

Sustainability reporting: How consistency and interdependence in financial and managerial accounting enhance eco‐controls

Varma,

Mancini,

Kaushik

2024

Journal of Public Affairs

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Sustainability reporting requires consistency and interdependency of financial accounting and managerial accounting. Accounting is closely entangled with the eco control (EC) in organisations. The quality of (sustainability) reporting and the disclosures is only as good as the quality and consistency of accounting data captured. Therefore, accounting choices and practises have an important role to play in sustainability reporting. This study explores the mechanism through which accounting informs EC. Through the independent and serial use of two levers, first ‘interdependency’ between financial accounting and management accounting and second, though the use of ‘digitalized information’ as a moderating variable, it is probed as to how EC are shaped. An empirical investigation is undertaken by carefully curating primary data, analysed through partial least squares structural equation modelling technique to inform broader debates in the ‘sustainability reporting’ literature concerning the mechanisms through which EC, are influenced by accounting mechanics, choices and disclosures. Sound EC contributes to sustainability accounting and governance to meet needs of the firms direct and indirect stakeholders without comprising the firm's ability to meet the needs of future stakeholders. The study established that the interdependency between the financial accountants and the management accountants output, mediates the effect of a consistent financial language on EC practises and this effect is independent of the firm size or the industry category. This article brings to the fore, the interplay of FA and MA in informing the environmental controls. The under researched perspective addressed by this study is that EC are highly interdependent with the consistency and comprehensiveness of accounting that informs it which in turn is effected by the cooperation and coordination (interdependency) between FA and MA information providers.

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“…There were attempts to find a common definition of public interest at European level that would be based on national definitions. The research by Hossfeld et al (2018) analyzed countries representing common law and civil law systems (United Kingdom, Germany, Spain, France, Italy, and Romania). However, no common definition could be derived.…”

mentioning

confidence: 99%

Public Benefit and Public Interest – Two Sides of the Same Coin?

Sever

2024

CEPAR

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Purpose: Driven by the question of how the concepts of public interest and public benefit differ, this paper delves into the Slovenian legal system. Through an in-depth analysis of legal concepts, national regulations, and case law from the Slovenian Constitutional Court and selected cases from the European Court of Human Rights, its aim is to illuminate the key differences between both terms. Ultimately, the paper seeks to establish fundamental guidelines for understanding the distinct meaning and application of each concept. Design/methodology/approach: The research is based on a content analysis research design, reviewing secondary literature sources. It employs qualitative methods by analysing the relevant theoretical points, rules, and constitutional case law in the Slovenian legal system, as well as selected European Court of Human Rights case law. The analysis focuses on identifying and extracting key theoretical arguments, legal definitions, and practical applications of both concepts. To distinguish between public benefit and public interest, the analysis adopts a comparative approach, examining how each concept is defined, applied, and balanced in different legal contexts. Additionally, synthesis is used to identify commonalities and divergences between different perspectives on these concepts. Finally, conclusions about the relationship between public benefit and public interest are drawn based on the analysed data. Findings: Public interest and public benefit are abstract concepts. The analysis of relevant Slovenian systemic regulations shows that the two are sometimes applied interchangeably. However, theory suggests that there are certain differences in terms of their tangibility and enforceability. Constitutional case law refers to both concepts in a general way without fully defining their content, yet it does not treat them as synonyms. Academic contribution to the field: Public interest and public benefit are central concepts of public administration science. Public interest is key in defining and shaping administrative relations decided in an administrative procedure. It represents the core value of the public sector, ensuring that its operations are legitimate. Public benefit, on the other hand, is the general benefit of an organised wider community, superior to the benefits of individuals and generally considered equivalent to substantive legality. As public and private interests collide, state intervention with appropriate regulation is necessary to protect the public benefit.Originality/significance/value: This research contributes to the understanding of the concepts of public interest and public benefit within the Slovenian legal system and is a novelty in the field as no such overview has been undertaken before. Its value lies in the analysis of Slovenian constitutional case law over the last twenty-two years and insights into European Court of Human Rights case law. The focus on European Court of Human Rights and Slovenian legislation and case law limits the generalisability of the findings to other contexts. This approach was chosen as much of the relevant legislation for this research is independent of EU influences. Nonetheless, being an EU member state, Slovenia’s legal framework shares some commonalities with other European systems. The added value of the analysis lies in its relevance for understanding how these concepts are treated in similar legal systems, offering valuable insights for comparative studies.

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The Evolution of the European Public Good Assessment in the EU Endorsement Process of IFRS

Cited by 9 publications

References 16 publications

Practical expedients and theoretical flaws: the IASB's legitimacy strategy during the COVID-19 pandemic

Practical expedients and theoretical flaws: the IASB's legitimacy strategy during the COVID-19 pandemic

Sustainability reporting: How consistency and interdependence in financial and managerial accounting enhance eco‐controls

Public Benefit and Public Interest – Two Sides of the Same Coin?

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