A new study by Professor Shujun Ding funded by the University of Ottawa’s Research Development Program and the Telfer School examines which factors lead private firms’ to voluntarily adopt the international financial reporting standards, or IFRS. The research also asks if the adoption of IFRS improves access to external capital.
Implementation of IFRS — mandatory for publically listed firms since 2011 — remains optional for private firms, which must weigh the pros and cons of implementation. These companies might consider it too costly, demanding resources and skills that they might not have. On the other hand, private firms that have adopted IFRS may have improved accounting information, which may increase their chances of obtaining bank loans, all else being equal. The study will take a closer look at the issue.
Shujun Ding teaches both management and financial accounting. His main research interests include judgment and decision-making in accounting contexts, corporate governance, and accounting and finance issues in small business. He was recently awarded a $12,000 grant for this study.