Does the IFRS Effect Continue? An International Comparison

Round  1

Reviewer 1 Report

The paper investigates the effects on accounting quality after the implementation of IFRS.

It is a very interesting paper, but there are some aspects that the authors need to improve:

The term sustainability in this study is referred to sustainability of companies on long terms, not to social and environmental topics, as sustainability is usually intended. In my opinion this aspect must be clarified at line 115-118.

The literature review must be improved with other representative research, also with articles published in Sustainability journal:

Lim, K.; Nam, G. Is Earnings Management in the South Korean Defense Industry Sustainable? Sustainability 2017, 9, 2023.

Park, H. Market Reaction to Other Comprehensive Income. Sustainability 2018, 10, 1837.

Xu, L.; Zhang, S.; Liu, N.; Chen, L. Corporate Hypocrisy: Role of Non-Profit Corporate Foundations in Earnings Management of For-Profit Founder Firms. Sustainability 2018, 10, 3991.

Please mention in the paper which software was used for regressions.

The comparisons of the results obtained with other similar studies are missing, try to find other research with similar results, you can also find it in the articles recommended.

In the section Conclusion, the limits of the paper and future research are not specified you have to mention this aspect.

Author Response

Author Response File: Author Response.docx

Reviewer 2 Report

Please find attached the review report.

Comments for author File: Comments.pdf

Author Response

Author Response File: Author Response.docx

Reviewer 3 Report

1. The choice of the countries is not well explained.

2. The authors should pay attention to the methods of implementing IFRS used by the different countries they considered (see Zeff and Nobes, 2010). They should mention this in a background section on the adoption of IFRS in the countries analysed, which I think is necessary if one is to understand the results properly. This would also be of interest in terms of the discussion of the results.

Zeff, S. A. and Nobes, C. W. 2010, ‘Commentary: Has Australia (or Any Other Jurisdiction) ‘Adopted’IFRS?’, Australian accounting review, 20 (2): 178-184.

3. Another issue the authors should take into consideration is the “IFRS familiarity hypothesis” (Tsalavoutas et al., 2014).

Tsalavoutas, I., André, P. and Dionysiou, D. 2014, Worldwide application of IFRS 3, IAS 36 and IAS 38, related disclosures, and determinants of non-compliance, ACCA Research Report 134.

4. The authors miss a lot of relevant papers that may help them to refine the discussion of results:

Haller, A. and Wehrfritz, M. 2013, ‘The impact of national GAAP and accounting traditions on IFRS policy selection: evidence from Germany and the UK’, Journal of International Accounting, Auditing and Taxation, 22 (1): 39–56.

Kvaal, E. and Nobes, C. W. 2010, ‘International differences in IFRS policy choice’, Accounting and Business Research, 40 (2): 173-187.

Kvaal, E. and Nobes, C. W. 2012, ‘IFRS policy changes and the continuation of national patterns of IFRS practices’, European Accounting Review, 21 (2): pp. 343-371.

Lourenço, I. C., Sarquis, R., Branco, M. C. and Pais, C. 2015, ‘Extending the Classification of European Countries by their IFRS Practices: A Research Note’, Accounting in Europe, 12: 223-232.

Nobes, C. and Stadler, C. 2013, ‘How Arbitrary are International Accounting Classifications? Lessons from Centuries of Classifying in Many Disciplines, and Experiments with IFRS Data’, Accounting, Organizations and Society, 38 (8): 573-595.

Nobes, C. W. 2006, ‘The survival of international differences under IFRS: towards a research agenda’, Accounting and Business Research, 36 (3): 233-245.

Nobes, C. W. 2008, ‘Accounting classification in the IFRS era’, Australian Accounting Review, 46 (3): pp. 191-198.

Nobes, C. W. 2011, ‘IFRS practices and the persistence of accounting system classification’, Abacus, 47 (3): pp. 267-283.

Nobes, C. W. 2013, ‘The continued survival of international differences under IFRS’, Accounting and Business Research, 43 (2): pp. 83-111.

4. The first paragraph of section 2 should be deleted. This paper has little or nothing to do with corporate sustainability and with CSR. As the authors assert in p. 4 “a corporate governance structure that protects outside investors is another component of corporate sustainability”. However, this is not an issue thoroughly explored in the empirical study. The link to CSR and CS could be sustained if the authors were able to develop this aspect empirically.

Author Response

Author Response File: Author Response.docx

Round  2

Reviewer 1 Report

The paper has been improved with my recommendations and other reviewers.

Congratulation!

Reviewer 2 Report

The author(s) provided a much-improved version of the manuscript. The suggestions and recommendations were taken into account in a proper manner. The paper should be published in current form. Hence, I endorse paper acceptance.

Reviewer 3 Report

Good job!