Earnings management IFRS adoption in Brazilian and British companies

In Brazil, the convergence to IASB began in 2008. To analyze these effects on Brazilian companies, it was chosen to compare them with British companies, which went through this process from 2005 on. The study aims to assess the influence of the convergence process to IASB on the earnings management level of Brazilian and English companies. Descriptive study based on the model of Barth et al. (J Account Res 46(3):467-498, 2008) was performed with data of 721 British companies and 170 Brazilian companies. The results showed reduction in the earnings management levels in British companies with the adoption of IFRS and increase in Brazilian companies after the Law 11.638/07. Although the model of Barth et al. (2008) uses various measures of earnings management and works with controlling variables that minimize the environmental effects on the management measures, it does not address other measures of earnings management. Similar result was obtained by Jeanjean and Stolowy (J Account Public Policy 27:480-494, 2008) when analyzing the process of international accounting convergence in Australia, France and England. It is concluded that the convergence to international standards of IASB depends on the adequacy of the legislation, investment in protecting the investors, good corporate governance practices and improvement in the accounting education quality. © 2018 Macmillan Publishers Ltd., part of Springer Nature.