The introduction of the IFRS in the European Union, and many other countries, has not eliminated the need for research concerning the comparability of financial statements. The IFRS still offers many options. Extensive theoretical literature exists concerning the definition of comparable financial statements and the factors that influence this comparability. This paper aims to investigate this issue.
The paper uses a survey of 426 individuals who use European IFRS financial statements.
This study shows that most of the respondents (67 per cent) interpret comparability as uniformity, that is, that all companies using the same accounting methods. Comparability of financial statements over time and of companies operating within the same industry are considered to be the most important types of comparability. Both types are jeopardised because of continuous changes in IFRS and the lack of industry specific guidance. Only 41 per cent of the respondents believe that all IFRS financial statements are comparable. Not only accounting methods used, but also judgements made by preparers and interpretation differences are viewed as important factors influencing the comparability of financial statements.
As surveys are uncommon in accounting literature, often because of sampling problems, the validity of this research should be further improved by additional surveys or other empirical research approaches.
This study contributes to the research by determining which factors influence the comparability of financial statements according to the auditors, analysts and other users and what their view is on the comparability of financial statements.
