Perceptions of Czech accounting professionals on current trends in financial reporting

Saturday, 5 April 2014: 9:30 AM
Jiri Strouhal, Ph.D. , Department of Strategy, Skoda Auto University, Mlada Boleslav, Czech Republic
Hana Rezankova, Ph.D. , University of Economics, Prague, Prague 3, Czech Republic
Carmen Bonaci, Ph.D. , Department of Accounting, Babes-Bolyai University, Cluj Napoca, Romania
Razvan V. Mustata, Ph.D. , Department of Accounting, Babes-Bolyai University, Cluj Napoca, Romania
International convergence of accounting standards is not a new idea. The concept of convergence firstly arose in the late 1950s in response to post World War II economic integration and related increases in cross-border capital flows. Initial efforts focused on harmonization—reducing differences among the accounting principles used in major capital markets around the world. By the 1990s, the notion of harmonization was replaced by the concept of convergence—the development of a single set of high-quality, international accounting standards that would be used in at least all major capital markets.

Czech Republic is a typical representative of emerging economy from CEE area with the traditional linkage of accounting system to tax system and application of prudence principle in accounting. That is why fair value it is not such widely applied like under IFRS practices.

Main objective of this research was to find out the perception of the professional accountants on current trends in international accounting and how it might influence local Czech accounting practices. For this purpose there was prepared a questionnaire survey. This survey was conducted among selected Czech companies in spring 2013. The research was targeted on companies with clear audit opinion and questionnaire was sent to 4,082 companies. The return rate was 9.1 % and we analyzed 371 valid questionnaires.

Analytical part of this survey (conducted online via Google forms) was divided onto two parts: (i) questions related to company’s behavior (3 questions) and questions related to perceptions on selected accounting issues (7 questions).

First set of questions was related to companies’ real behavior. We tried to analyze the areas of depreciation policies, impairment and provision issues and also the popular area of financial securities and derivatives.

Second part of this questionnaire survey dealt with the impact of current trends in international accounting and their possible spread to Czech accounting rules. Concretely there were discussed the issues of finance lease, fair value measurement, revenue recognition and also financial statements.

On specific case of Czech professional accountants it seems that the willingness to support the trends of international accounting in emerging CEE economies is on high level.

This paper is one of the research output of the project TD020190 registered at Technology Agency Czech Republic (TACR).

Back to: Contemporary Problems of Finance and Accounting in Emerging Economies III
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