The Appropriateness of Applying International Financial Reporting Standards(IFRS) in Jordan's Economic Environment – Empirical Study

Abstract

This study discusses how appropriate is the applying of all International Financial Reporting Standards (IFRS) in the entities in Jordan based on the effective Jordan’s economic rules. For that, the researchers briefly embarked upon the IFRS and their setter. They also considered the exception dealing with the issuance of special standard for small and medium entities, and the possibility of its application in Jordan rather than applying all IFRS by corporations, or issuing a similar exception for applicable standards in Jordan. With a view to understanding the entities actual application of IFRS, the difficulties they face, and the possible solutions from the viewpoint of the appliers, the researchers has adopted the qualitative description method through the empirical study they carried out to test its assumptions. Among a group of conclusions, the researchers have most importantly found the Jordan’s entities did not apply all IFRS, nor did they apply in part some of those standards. That is due to the lack of proper areas of applying full or partial standards, on the non-different information, that have been prepared by the small and medium entities based on the SMEs for IFRS, from that had been prepared in accordance with the IFRS. Finally the researchers recommend that it is possible to universalize the IFRS for SMEs for all Jordan’s entities, or to issue an identical, applicable standard to the Jordan’s economic environment. The study ensures the independence of the (board of international financial standards) from the pressures of great powers, as well as the importance of the diversification of practical experience of the board's members that ensures the taking of the developing countries' economics into consideration.