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IFRS adoption and influence of tax rules on financial reporting practices in Brazil and Australia

Grant number: 11/07281-0
Support Opportunities:Scholarships abroad - Research
Effective date (Start): January 09, 2012
Effective date (End): January 08, 2013
Field of knowledge:Applied Social Sciences - Administration - Accounting
Principal Investigator:Sílvio Hiroshi Nakao
Grantee:Sílvio Hiroshi Nakao
Host Investigator: Sid Gray
Host Institution: Faculdade de Economia, Administração e Contabilidade de Ribeirão Preto (FEARP). Universidade de São Paulo (USP). Ribeirão Preto , SP, Brazil
Research place: University of Sydney, Australia  


Together with the adoption of international accounting standards by Brazil in 2007, it was also established the so-called tax neutrality, separating the practice of financial accounting of tax rules that occurred so far. This link may have functioned as a governance mechanism that may have served the interests of investors and tax authorities to avoid misleading information. If it worked effectively, it prevented the occurrence of earnings management with significant increases in earnings. With the adoption of IFRS, the linking mechanism is replaced by less conservative standards. However, it is possible that an increase of earnings management has occurred, given the greater freedom of discretion. Possibly, countries without such a linking mechanism had a process of transition to IFRS with minor increases of earnings management. The objective is to examine the effects of IFRS adoption about earnings management and conservatism in Brazil and Australia, which have disclosure practices influenced differently by the tax rules. (AU)

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Scientific publications
(References retrieved automatically from Web of Science and SciELO through information on FAPESP grants and their corresponding numbers as mentioned in the publications by the authors)
NAKAO, ILVIO HIROSHI; GRAY, SIDNEY J.. The Impact of IFRS in Brazil: The Legacy of Mandatory Book-tax Conformity. AUSTRALIAN ACCOUNTING REVIEW, v. 28, n. 4, p. 482-495, . (11/07281-0)

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