Journal of Accounting and Management Information Systems (JAMIS)


Vol. 11, Nr. 2/2012 ,   p191..208

Mădălina GÎRBINĂ
Mihaela MINU
Ştefan BUNEA

Keywords:   IFRS, financial reporting, banks, accounting basis, national regulations


Starting 1 January 2012, credit institutions arerequired to apply the International Financial Reporting Standards (IFRS) asbasis of accounting for the preparation of the individual financial statements.Regulatory reforms were done and banks prepared to face the transition process.In this context, the aim of our study is to investigate, the perceptions of themain actors from banks (responsible with the transition process) on the costand benefits involved by the use of IFRS as reporting standards (implementationstrategy used by some banks before 2012) and on the peculiarities related tothe application of IFRS as accounting basis (each transaction or event beingrecorded following IFRS requirements) immediately after 1st January2012. We intended to investigate also if the transition process changed theattitude of banks towards the application of IFRS. We observed that preparersstill have a positive attitude towards the application of IFRS considering thatthe cost benefit report is a positive one. Not all preparers are convinced thatthe conversion will lower the cost of capital. The complex nature of IFRS, theinsufficient application guidance and the necessity to adapt to frequentchanges of IFRSs were considered as difficulties related to IFRS reporting. Double reporting costs reduction andeliminating confusions by publishing two sets of financial statements wereconsidered unanimously benefits of using IFRS as basis of accounting. Itresulted that most preparers are concerned about the costs involved by themodification of internal evidence systems, the necessity to satisfy multiplereporting requirements (accounting, prudential and fiscal), the impact onprudential indicators and the insufficient resources allocated to this process.The most important cost was related to the modification of actual IT systems.The impairment methodology described by IAS 39 was rated as most challenging bypreparers.