Investigating the Effect Analysis of Accounting Standards in the Process of Standard Setting and Empirical Accounting Research

Setting accounting standards or modifying them has consequences. These consequences make accounting standards setting complex and difficult. The issue of whether accounting standard setters should take account of the effects, or consequences, of the standards, has been a subject of debate for decades. Finally, effects analysis integrated into the standard setting due process. Effects analysis is an analysis of the likely effects of the forthcoming standards or major amendment. It should be noted that effects analysis is a process and is not merely a single point-in-time event. In this paper, the dimensions of effects analysis of accounting standards have been examined, then related empirical research is reviewed and analyzed. Accounting researchers generally have studied the effects of a standard or the effects of a set of standards using market-based characteristics, accounting-based characteristics and analyst-based characteristics, as well as doing survey research. They use accounting and disclosure criteria such as earning management, income smoothing, timely recognition of losses and value relevance.