IFRS adoption and financial reporting quality in the MENA region

Purpose Global interest in adopting the International Financial Reporting Standards (IFRS) has risen rapidly; however, Middle Eastern and North African (MENA) countries have reacted differently towards international diffusion. The purpose of this study is to examine impact IFRS adoption/rejection decision on quality MENA region firms' financial reporting. Design/methodology/approach accounting examined through five metrics models measure earnings smoothing, managing a target timely loss recognition. research sample consists nine over period ten years (2006–2015), resulting 3,040 firm-year observations main phase, 2,580 additional analysis. Findings findings reveal that overall adopters benefited from adoption IFRS, as results show there reduction management for comparison local standards adopters. sub-sample analyses also firms adopted both rentier (oil-dependent states) non-rentier states, higher reporting than non-IFRS However, magnitude was states. Research limitations/implications Similarly previous field, adopts strict selection approach. Such an approach may limit size, although researchers taken every possible step ensure use adequate size. acknowledge years, despite having stated its rationale importance more extended quest paper. Practical implications This provides valuable input by evaluating current status quality, based their followed regime. paper result better-informed decisions investors information contents annual reports enhance comparisons facilitate further flow investments. significant insight into Accounting Board (IASB). will assist IASB understanding measuring consequences countries' Originality/value contribute literature revealing with medium levels governance most adoption, while stronger demonstrate lower quality.