THE IMPACT OF IFRS ADOPTION ON GLOBAL COMPETITIVENESS

Abstract

Global adoption of International Financial Reporting Standards (IFRS) represents a significant transformation that enhances the harmonization of accounting practices and the comparability of financial statements. In this study, the relationship between countries’ levels of IFRS adoption and global competitiveness indicators is investigated using Multivariate Analysis of Variance (MANOVA) and discriminant analysis to comprehensively examine this transformation. Data from 86 countries are analyzed, revealing significant differences in several competitiveness indicators based on IFRS adoption levels. The MANOVA results indicate that countries with full or partial IFRS adoption generally exhibit higher institutional quality, infrastructure, and information and communication technology adoption rates. The discriminant analysis classifies countries based on their IFRS adoption levels with an accuracy rate of 77.9%, demonstrating that these adoption levels play a critical role in determining the relevant indicators. The findings suggest that adopting IFRS can enhance economic performance and institutional quality providing valuable insights for policymakers.