The perceptions of international accounting standards’ application in emerging economies: an institutional perspective

Purpose This study examines how Egyptian firms are applying international accounting standards. Particularly, it explores the different institutional pressures and impediments of Egyptian firms to apply international accounting standards. Design/methodology/approach This study draws upon data collected from interviews conducted with various constituents of the accounting profession in Egypt, including audit partners, senior auditors and accountants. Findings The findings revealed a case of institutional complexity where a set of institutional pressures (namely, economic, community and state governance institutions) hinders the application of international accounting standards in a developing market. The economic institutions have directed professionals’ attention to primarily attain their self-interests. The community institutions have directed professionals’ attention towards secrecy and the adoption of informal practices. Finally, the state (governance) institution has worked as a negotiating order, placing pressure on the other constituents for the benefit of all parties. Originality/value This study contributes to the literature by critically examining the institutional impediments to international accounting standards’ application in developing markets. This study extends the literature by bringing new evidence from an emerging market regarding complexities facing the application of international accounting standards due to the prevalent sociopolitical ramifications.