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Investigating international accounting standard setting: the black box of IFRS 6

Journal Article


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Abstract


  • This paper examines the role of powerful entities and coalitions in shaping international accounting standards. Specifically, the focus is on the process by which the International Accounting Standards Board (IASB) developed IFRS 6, Exploration for and Evaluation of Mineral Resources. In its Issues Paper, the IASB recommended that the successful efforts method be mandated for pre-production costs, eliminating the choice previously available between full cost and successful efforts methods. In spite of the endorsement of this view by a majority of the constituents who responded to the Issues Paper, the final outcome changed nothing, with choice being retained. A compelling explanation of this disparity between the visible inputs and outputs of the standard setting process is the existence of a “black box”, in which powerful extractive industries entities and coalitions covertly influenced the IASB to secure their own ends and ensure that the status quo was maintained.

Publication Date


  • 2010

Citation


  • Cortese, C. L. & Irvine, H. J. (2010). Investigating international accounting standard setting: the black box of IFRS 6. Research in Accounting Regulation, 22 (2), 87-95.

Scopus Eid


  • 2-s2.0-77956231589

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1765&context=commpapers

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/724

Has Global Citation Frequency


Number Of Pages


  • 8

Start Page


  • 87

End Page


  • 95

Volume


  • 22

Issue


  • 2

Abstract


  • This paper examines the role of powerful entities and coalitions in shaping international accounting standards. Specifically, the focus is on the process by which the International Accounting Standards Board (IASB) developed IFRS 6, Exploration for and Evaluation of Mineral Resources. In its Issues Paper, the IASB recommended that the successful efforts method be mandated for pre-production costs, eliminating the choice previously available between full cost and successful efforts methods. In spite of the endorsement of this view by a majority of the constituents who responded to the Issues Paper, the final outcome changed nothing, with choice being retained. A compelling explanation of this disparity between the visible inputs and outputs of the standard setting process is the existence of a “black box”, in which powerful extractive industries entities and coalitions covertly influenced the IASB to secure their own ends and ensure that the status quo was maintained.

Publication Date


  • 2010

Citation


  • Cortese, C. L. & Irvine, H. J. (2010). Investigating international accounting standard setting: the black box of IFRS 6. Research in Accounting Regulation, 22 (2), 87-95.

Scopus Eid


  • 2-s2.0-77956231589

Ro Full-text Url


  • http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1765&context=commpapers

Ro Metadata Url


  • http://ro.uow.edu.au/commpapers/724

Has Global Citation Frequency


Number Of Pages


  • 8

Start Page


  • 87

End Page


  • 95

Volume


  • 22

Issue


  • 2