Adoption of IFRS in Developing Countries: A Comparative Analytical View Between the Interpretation of the Economic Networks Theory and the New Institutional Theory

Abstract

The purpose of this study is to identify factors that support or constrain developing countries' decisions to adopt International Financial Reporting Standards (IFRS), by answering the main question about the possibility of developing countries taking the decision to adopt IFRS, although their economic value is less efficient than their local standards, using the analytical perspective of network theory (Economic Network). The study found that developing countries are more attractive to take the decision to adopt IFRS, although they cannot achieve automatic benefits, and that the fragility of their economic and political climate is a strong predictive factor that has a marked negative impact on the adoption of standards