Perceptions of Role of Human Behavior in Adopting International Financial Reporting Standards

In their droves, many countries are joining the bandwagon of adopters of International Financial Reporting Standards (IFRSs), perhaps, taking for granted the human behaviors possibly influencing their decisions. Drawing upon themes from psychology, this paper elicits students’ perceptions of the role of subliminal behavioral biases that are likely influencing IFRS adoption decision. Factor analyses methods were performed on questionnaires administered on 63 undergraduate students studying accounting and finance in a University in Nigeria. The results suggest that eight behavioral components explain more 70% of the decision to adopt IFRS in Nigeria. This finding is generalizable to other countries because human beings make (do not make) decisions in all countries. An understanding of the perceived influence of the psychological themes operationalized in this paper enhances an understanding of human biases influencing the decision to adopt IFRS. This paper recommends that behavioral approaches should be employed to persuade decision makers in countries where IFRS has not yet been adopted to follow suit.