The 2007 Spanish accounting reform: A reflection

La reforma contable española de 2007: un balance

Abstract

This article presents some reflections on the in-depth Spanish accounting reform carried out between the years 2001 and 2010, where the more important milestone is the promulgation of the General Accounting Plan revised in 2007. Arguments are made from the stated goal of converging the Spanish standards with International Financial Reporting Standards, making a balanced review of the process, the achievements and the problems that have arisen in the Spanish accounting system, which has greatly changed its orientation in an unusual way for a country of continental Europe accounting tradition.As a result of the process, Spain has introduced huge innovations in the financial reporting of all companies which have agreed to modernize in order to participate in the internationalization process that characterizes the Spanish economy, so that concepts such as the classes of financial instruments, other comprehensive income or the deferred tax accounting based on the balance sheet approach are common accepted in accounting practice.The change, which was developed in a participatory manner (White Paper), has preserved the quintessential standardization tool, which is the General Accounting Plan, while consolidating the independence of accounting and tax rules. The paper highlights some weaknesses of the Spanish accounting system, most notably the lack of flexibility for further changes, since the General Accounting Plan is conceived as a code that supports hardly any amendments, not only because of the companies’ reluctance to change, but also for the time taken for administrative processes to introduce improvements. For that reason, changes could be delayed for the foreseeable future, harming the objective of continuous approach to international standards.