What is it about?
Financial reporting is not immune to the COVID-19 pandemic, even in small corners of the world like Serbia. As we expected, it was strongly and deeply affected by the economic crises caused by the pandemic. Not surprisingly, we find that financial reporting problems regarding future expectations and uncertainty are an important source of concern for preparers of financial statements, which implies that standard-setters, such as the IASB, should pay more attention to those problems to make financial reporting standards more adequate to disturbances in economic conditions. The preparers who apply IFRS for SMEs perceived slightly more difficulties than those who apply full IFRSs. This means that the IASB should pay more attention to the ability of IFRS for SMEs to be an adequate financial reporting basis in crisis conditions.
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Why is it important?
Several reasons make the transitioning economy of Serbia a good fit for a study on the impact of COVID-19 on financial reporting. Namely, IFRSs have relatively long been a key financial reporting base in Serbia, accounting information has specific characteristics in the Serbian economy, and financial reporting regulation in the Serbian economy is undergoing frequent changes. Additionally, the regulatory framework for financial reporting in Serbia was the subject of comprehensive reform immediately before and during the COVID-19 pandemic. Therefore, in addition to the difficulties imposed by the COVID-19 pandemic, reporting entities in Serbia also faced the need to adapt to new accounting regulations simultaneously. Specifically, they needed to adapt to the new and revised IASB’s documents and consequently reconsider their accounting policies, as well as adapt to the new chart of accounts and financial statement templates.
Perspectives
Conducting research using the questionnaire is not an easy task in Serbia. A key limitation of our study is, therefore, the modest response rate of preparers of financial statements. We were also unable to fully identify and neutralise the answers that, intentionally or unintentionally, do not reflect respondents’ attitudes and facts about them. We are, nevertheless, thankful to the respondents who provided the answers to our questions and helped us identify their attitudes towards financial reporting in times of crises caused by the COVID-19 pandemic. We believe that the relatively large number of 100 respondents did help us minimize the chance answers and results.
Milan Čupić
University of Kragujevac
Read the Original
This page is a summary of: Financial reporting in times of crisis: The case of the Serbian developing economy during COVID-19, Australian Journal of Management, June 2023, SAGE Publications,
DOI: 10.1177/03128962231177094.
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