“ACCOUNTING HARMONIZATION IN THE EUROPEAN UNION: THE EFFECTS AND THE IMPACT OF ACCOUNTING DIFFERENCES – COMPARISON ACROSS COUNTRIES”

The topic that I’m going to present is a comprehensive topic which covers the standardization of accounting practices across EU member states in great detail. The objective of this study is to explore the differences between accounting policies in EU countries, test their consistency and identify and analyze the main variables influencing these differences. The aim is to provide useful information for policymakers, regulators, and practitioners dealing with the challenges of financial reporting in a varied but interconnected economic environment. I selected this topic because of its broad effects on the financial system, corporate governance, regulatory framework, and economic unity in the EU. It holds significance for multiple reasons, each relating to different stakeholders and aspects of the economic and financial environment in the EU. First of all, there will be a first theorical part to better introduce and explain the argument, showing the key aspects of the accounting harmonization procedure in the EU, highlighting the regulatory achievements and actions taken to encourage uniformity, showing the benefits of harmonization, and outlining the current status of regulation and implementation in Europe. In this section, I will review the current literature regarding this subject, with a particular emphasis on the key accounting disparities among EU nations. Afterwards, the thesis proceeds with a section focused on an empirical analysis. I will take into consideration three hypothesis concerning the harmonization of accounting standards through IFRS, the influence of domestic economic and institutional factors, and the persistence of historical and cultural differences. After this, I will empirically test these hypotheses considering several variables on a sample of ten EU countries.