Transposition of Directive 2013/34/EU into Maltese Law : the accountancy profession’s view

Abstract

PURPOSE: The setting of quality accounting standards plays a crucial role in the functioning of the local economy. The recent transposition of Directive 2013/34/EU in the National GAAP was not subject to a public consultation. This study, therefore, examines the perceptions of practitioners and preparers to determine their alignment with the final position adopted in Malta. DESIGN: A convergent mixed-methods research design was employed, where a merged survey and interview guide was designed to collect the perceptions of practitioners and preparers on the transposition of Directive 2013/34/EU in the National law. Participants from six different classes of practitioners and preparers completed an online survey (n=242) and participated in a semi-structured, in-depth interview (n=6). FINDINGS: The majority of respondents agreed with the position adopted in Malta on all of the analysed member state options, indicating a preference for consistency with IFRSs and GAPSE. Nonetheless, practitioners, particularly practitioners in Big four firms, were found to be more aligned with the position adopted in Malta, than preparers. Additionally, although a slight majority of respondents agreed with the transposition process adopted in Malta, a more transparent approach was desired. CONCLUSION: Given that practitioners were found to be more represented in the transposed legislations than preparers, the primary objective of Directive 2013/34/EU to reduce the reporting burden on preparers might not have been fully implemented in the National GAAP. Continuous communication of key decisions during the drafting of accounting legislations is therefore recommended to enhance the transparency of standard-setting processes and safeguard against the influence of specific groups of stakeholders. VALUE: This study adds to local literature by providing an initial framework on the effectiveness of Malta’s accounting standard-setting processes with reference to the transposition of Directive 2013/34/EU into Maltese law. Several technical recommendations and areas for further research were also put forward.