Ramos (2011) [7]

・ Examines the importance of accounting harmonization on foreign activities at a macroeconomic level.

・ Sample 27 EU countries plus United States, China, Japan, EFTA members and Croatia, Turkey from 2002 to 2007, as well as data on bilateral FDI flows (namely investments by resident entities in affiliated enterprises abroad).

・ IFRS adoption benefits trade in goods and FDI.

・ Positive effect of harmonizing accounting standards on foreign activities in Europe differs in countries because of behavioral factors such as unfamiliarity aversion.

Schleicher, Tahoun, and Walker (2010) [2]

・ Examine the economic consequences of the mandatory IFRS adoption in the EU countries by showing which types of economies have the largest reduction in investment-cash flow sensitivity post-IFRS.

・ Examine whether the reduction in investment cash flow sensitivity depends on firm size as well as economy type.

・ Sample of 6 EU countries with 5655 firm year observations from periods 2000-2004 and 2005-2007.

・ The investment cash flow sensitivity of higher economies is higher than that of outsider economies pre-IFRS.

・ IFRS adoption reduces the investment cash flow sensitivity of insider economies more than that of outsider economies.

・ Insider economies have higher investment cash flow sensitivity using both current and lagged cash flow.

・ IFRS adoption may have improved the functioning of capital markets in relation to small firms in insider economies.