Abstract

The purpose of this paper is to examine and review the literature regarding the accounting and auditing environment in Hellas; Hellas is a “natural experiment” in the sense that has characteristics that substantially differ from the major European countries. “For example, the mandatory adoption of International Financial Reporting Standards (IFRS) on January 1, 2005 aimed to improve the quality of financial reporting in Greece, which had been regularly criticized for earnings management and the ineffectiveness of external auditing”. In addition, Hellas faced a 10-year economic crisis (2008-2018) which affected/ changed the Hellenic corporate and capital market environment. For the years before the crisis and the implementation of IFRS, empirical studies shown that Hellas has the one of the highest levels of earnings management. All these features are examined in this article in order to gain insight regarding the quality of Hellenic financial reporting and to investigate the changes that crisis had on financial statements quality. The conclusion is that crisis exaggerated problems that already existed in Hellenic corporate environment.

Keywords

Environment; Hellenic corporate

Introduction