Purpose: This paper presents a systematic literature review, including content and bibliometric analyses, of the impact of blockchain technology (BT) in auditing, to identify trends, research areas and construct an agenda for future research.Design/methodology/approach: The authors include studies from 2010 to 2020 in their structured literature review (SLR), using accounting journals on the Scopus database, which yielded 40 articles with blockchain and auditing at its core.Findings: One of the contributions of the authors’ analyses is to group the prior research, and therefore also the agenda for future research, into three main research areas: (1) Blockchain as a tool for auditing professionals to improve business information systems to save time and prevent fraud; (2) Smart contracts enabling Audit 4.0 efficiency, reporting, disclosure and transparency; (3) Cryptocurrency and initial coin offerings (ICOs) as a springboard for corporate governance and new venture financing. The authors’ findings have several important implications for practice and theory.Practical implications: The results of this study emphasise that (1) the disruption of blockchain in auditing is in a nascent phase and there is a need for compelling empirical studies and potential for the involvement of practitioners; (2) there may be a need to reconsider audit procedures especially suited for digitalisation and BT adoption; (3) standards, guidelines and training are required to pivot towards and confront the challenge BT will represent for auditing; and (4) there are two sides to the BT coin for auditing, enthusiasm about the potential and risk upon implementation. These practical implications can also be seen as a template for future research in a quest to align theory and practice.Originality/value: The authors’ SLR facilitates the identification of research areas and implications, forming a useful baseline for practitioners, professionals and academics, as they draft the state of the art on the disruption of blockchain in auditing, highlighting how BT is changing auditing activities and traditions.

Purpose: Grounded in the legitimacy theory and framed within the context of European Union’s (EU's) endorsement process, this paper analyses the International Accounting Standards Board’s (IASB's) response to the COVID-19 crisis and the impact of its practical expedient COVID-19-Related Rent Concession on the IASB's output legitimacy.Design/methodology/approach: This study uses a qualitative process-tracing approach and combines inductive historical narratives and deductive reasoning to draw theoretical implications concerning the COVID-19 crisis' impact on the standard-setting process.Findings: The paper shows a growing reliance on practical expedients in International Financial Reporting Standards (IFRS) to maintain the IASB's output legitimacy. While introducing some theoretical flaws, practical expedients increase the standards' flexibility and strengthen the IASB's ability to respond to the European political bodies' concerns. Indeed, an analysis of the IASB's response to the COVID-19 outbreak reveals the role practical expedients might play not only in reducing (ex ante) new IFRS transition costs but also in dealing (ex-post) with the broader economic impact of unexpected systemic crises to limit criticisms and controversies surrounding IFRS.Originality/value: This study reveals a causal relationship between the rise of the European public good criterion in the EU endorsement process and the wider use of practical expedients in IFRS. An analysis of the latest amendment to IFRS 16 in response to the COVID-19 crisis also confirms the role of practical expedients in strengthening the acceptance of IFRS in an increasingly complex economic reality and sheds some light on the new strategies adopted by the IASB to preserve its legitimacy in the EU.

Purpose: By analyzing the relationship between discretionary accruals and information asymmetry throughout the latest global financial crisis, this paper deepens our understanding of the effect of managerial discretion on the informativeness of earnings in the case of a negative exogenous shock in business fundamentals.Design/methodology/approach: This paper examines the relationship between discretionary accruals and the bid–ask spread within the Italian Stock Exchange over the period of 2007–2012. The authors focus on one country in order to avoid systematic cross-country performance variation in discretionary accruals models, and they use the bid–ask spread as a proxy for information asymmetry.Findings: This paper shows the role played by discretionary accruals in unblocking private information in the case of a negative exogenous shock in business fundamentals and finds a significant negative relationship between discretionary accruals and the bid–ask spread during the global financial crisis, although only limited to firms with strong corporate governance.Research limitations/implications: Since the paper focuses on one country, the findings might not be necessarily generalizable. Moreover, the relatively small sample size could be another limitation.Practical implications: This paper offers useful evidence to identify settings in which discretionary accruals increase the informativeness of earnings. Further, it suggests controlling for macroeconomic variables to mitigate the risk of an erroneous interpretation of discretionary accruals models.Originality/value: This paper extends knowledge and collects new evidence on the information content of discretionary accruals by investigating the relationship between discretionary accruals and information asymmetry during a systemic crisis.

The use of non-GAAP performance measures is a widespread, and certainly not a recent, phenomenon. In fact, companies increasingly believe that non-GAAP financial measures play a critical role in their financial communication strategy, and investors often rely on a wide range of non-GAAP measures to evaluate companies’ performance. However, anecdotal evidence also highlights a misleading use of non-GAAP financial measures, these metrics being disclosed more prominently than comparable GAAP metrics, and inconsistently presented from period to period. The apparent ‘schizophrenic’ nature of non-GAAP measures has often attracted scholars’ attention, while national and international security agencies and standard setters have recently renewed their interest in this topic. Therefore, this paper reviews the nearly two decades of research on non-GAAP reporting to offer insights into what academics have learned so far about non-GAAP reporting practices. In particular, this paper analyses the main objectives of the research, the related setting under investigation, the role of non-GAAP disclosure, and the type of non-GAAP metrics, with the aim of describing the evolution of this field of research over time and providing a structured reference point to carry research forward into specific sub-areas of interest.

Self-dealing refers to all kinds of transactions and operations whose aim is to divert value from a company to corporate controllers. In order to tackle self-dealing, scholars and regulators have emphasised the importance of legal tools. However, although the pro-regulatory approach prevails on a wide scale in the academic arena, there still exists a marked divergence between theoretical positions supporting the existence of a benchmark model towards which to converge (convergence hypothesis) and those that underscore the importance of socio-economic factors on the efficacy of governance rules (path dependency view). The aim of this paper is to join in the convergence vs. path dependency debate by adding some considerations on the efficiency of mandatory rules to the well-known investigations on the effectiveness of legal frameworks. Specifically, considering the current market integration and associated opportunities and threats, the traditional cost-benefit analysis has been extended in order to embrace direct and indirect costs specifically associated to the issue of domestic rules in a global scenario. Such an economic analysis on self-dealing introduces new variables that may support the convergence view and encourage at least a partial and gradual adjustment of national legislations towards the Anglo-Saxon model. To test our hypothesis, an examination of the self-dealing rules adopted in Germany, Italy and UK has been conducted. In particular, spatial and temporal comparisons of conflict of interests and self-dealing legislations have been carried out in order to appreciate trends, differences and similarities of some of the most important European legal frameworks.