A deep dive into the quality of financial reporting under International Financial Reporting Standards suggests it’s no better than the quality of reporting produced under U.S. Generally Accepted Accounting Principles.

Audit Integrity recently studied a subset of filings from 17 European countries from 2001 to 2008, taking in filings both before and after entities adopted IFRS in 2005 under European Union mandate. The study sought to determine whether IFRS has been implemented consistently across Europe, whether it has resulted in a common method of reporting financial data, and how the depth and comparability of data under IFRS compares to U.S. GAAP.

“Based on our analysis, we are not seeing a significant improvement in financial reporting when companies shift to IFRS,” said Jack Zwingli, CEO of Audit Integrity. “We found that IFRS is a common standard, but there are significant variances in IFRS reporting, in the completeness of information, the timeliness and the filing frequency.”

The firm says overall there are indications that financial reporting is more consistent and more comparable under IFRS than before IFRS adoption in Europe, but it’s not clear that IFRS represents an improvement over U.S. GAAP. In fact, the firm’s report says GAAP filers may have an edge over IFRS filing in terms of the timeliness, depth and breadth of financial data provided to investors.

Audit Integrity pointed out some weaknesses in IFRS filings that should be of interest to U.S. regulators as they consider whether to require IFRS in the United States. For example, adoption varies somewhat country to country, resulting in some inconsistency in the frequency and timeliness of reporting, as well as the exceptions provided to companies based on their size, the exchange on which they are listed and other country-specific criteria. The firm’s report also notes some countries show bigger variances than other when comparing key financial ratios.

Zwingli said he was also surprised that the analysis revealed IFRS generally provides less information about executive compensation. “It’s not good in the United States, but it’s better than it is in Europe,” he said. “There is more consistency in reporting and deeper coverage of data under GAAP than under IFRS.”