Did Embraer Succeed in Adopting the International Financial Reporting Standards (IFRS) in Brazil

Abstract

This article investigates the challenges that the Brazilian Aeronautics Company Embraer (Empresa Brasileira de Aeronáutica), faced to adapt its accounting system to the IFRS standards, adopted in Brazil in 2010. International Financial Reporting Standards (IFRS) were created by the International Accounting Standards Board (IASB), and IFRS Foundation in 2001, with the objective of unifying different business accountability standards in European Union (EU). From 1973 to 2001, the International Accounting System (IAS) was issued by the Board of the International Accounting Standards Committee (IASC). On April 1st 2001, the International Accounting Standards Board (IASB) created the International Accounting Standards (IAS), through the adoption of the existing IAS and the Standing Interpretations Committee standards (SICs). The IASB, then gave birth to International Financial Reporting Standards (IFRS), which spread very fast through European Union, and then to the rest of the world. Brazilian Federal Government adopted its standards nine years later, in 2010. Since then, the major Brazilian and multinational companies are facing challenges to harmonize their accountability system to the IFRS standards. This article investigates how Embraer, the first company in the Brazilian aeronautics segment, adapted to the IFRS standards, since its implementation in 2010. We analyzed Embraer’s IFRS demonstratives, in comparison to a European equivalent competitor, Airbus, throughout 2010-2015 periods. Finally, we brought managerial recommendations, as well as future research implications.

Keywords: Accounting Systems, Embraer, Financial Reporting, International, Standards


Article Review Status: Published

Pages: 37-48 (Download PDF)

Creative Commons Licence
This work by European American Journals is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License