International Financial Reporting Standards Adoption: Consequences and Benefits on Accounting Firms in Ghana

ABSTRACT 

Most nations in the world have modernized their accounting practices especially during the few decades of the 21st century. Such modernization encompasses the adoption and adaptation of local accounting practices and harmonizing it with that of the International Financial Reporting Standards (IFRS). Despite the significant decision by Ghana to adopt IFRS in the quest to increase harmonization and comparability of financial statements of companies in Ghana, as stakeholders in IFRS, have accounting firms who are the presenters and auditors of financial information benefitted from the adoption of IFRS? Has the IFRS adoption being costly for these firms? What are the consequences of IFRS adoption to these firms? The purpose of the study is to establish the major factors that led to the IFRS adoption in Ghana and to analyze the consequences and benefits of IFRS adoption on accounting firms in Ghana by studying some accounting firms in the Kumasi Metropolis, Kumasi, Ghana. The study is based on a purposive sampling of selected number of chartered accountants from various accounting firms in the Kumasi Metropolis. Survey questionnaires (close in nature) were administered and a total of 40 (40.81%) responses were received. In a Broad-spectrum, the legal system in Ghana appeared to be the most influential factor of IFRS adoption in Ghana. Inadequate technical competence in IFRS application and regulatory bodies to monitor and ensure compliance with IFRS were the most significant problems facing the adoption. From the survey, IFRS adoption in Ghana has improve the quality of financial reporting, increase transparency and consistency in accounting practices in Ghana. The study recommends that independent regulatory and monitoring bodies must be set up to objectively monitor compliance by firms.