Adoption of International Financial Reporting Standards (IFRS) to Enhance Financial Reporting in Oman
DOI:
https://doi.org/10.15282/jgi.6.2.2023.9654Keywords:
International Financial Reporting Standards, Financial Reporting, OmanAbstract
International Financial Reporting Standards (IFRS) are rapidly adopted globally to enhance financial reporting quality. All firms in Oman are required to follow IFRS. In addition, the Accounting Standards Board adopted IFRS in their entirety. The project objective is to test the relationship between the adoption of IFRS and financial reporting in Oman. This research used a quantitative method. The population of this study were 112 companies at Muscat Stock Exchange (MSX) for the year ended 2020 in Oman. The sample size of this project was 92 from three sectors of listed companies (Financial Sector 30, Industrial Sector 32, and Service Sector 30). The project results show a significant positive relationship between the adoption of IFRS and financial reporting in Oman. Firms that were Adopt-IFRS-Effective had high financial reporting quality, while firms that were Adopt-IFRS-Not-Effective did not affect their quality. This is because financial reporting is not solely dependent on these standards but has an impact. The implications of this research result in better-informed judgments for investors as the information included in the annual reports improves comparisons that facilitate the further flow of investments. Furthermore, provides significant insight into the International Accounting Standards Board (IASB). Also, this study has been added to the literature by examining the Adoption of IFRS on financial reporting in Oman context. Besides, this might add benefits to many firms relating to their current accounting standards practice that might lead to adopting IFRS to ensure the application of applicable accounting standards to show fair financial statements to its stakeholders. This current research is one of the first works in the context of Sultanate of Oman. It has added a new discussion to the body of knowledge considering the IFRS and their link with financial reporting quality. Furthermore, conducting such research in the accounting field provides new insight into the IFRS literature among both developed and emerging economies including Oman.
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