1. Introduction
1.1 The purpose of research
The economy of global has developed rapidly in recent years. Each of countries’ businesses are interconnecting and integrating. One factor of globalization which is global finance has an influence in financial reporting (Flower & Ebbers, 2002). Nowadays, financial statements are presented in various ways, a large quantity of the world’s listed companies use either IFRS or US GAAP. In spite of the heavy blow to the SEC of US which has announced that it will delay further statements regarding a timetable for its ultimate decision on the implementation of IFRS, the main trend of adoption of IFRS has not changed (Whitehouse, 2012). IFRS have also been adopted elsewhere. The purpose of this report is that estimate the market reactions of the UK when the UK market has adopted the IFRS.

1.2 Overview
The remainder of the paper is organized as follows. Section II discusses the background of IFRS adoption in Europe. Section III reviews prior research and provides the basis for interpreting the market reaction to each event. Section IV describes our data and research design. Section V presents our empirical results, and Section VI presents sensitivity analyses. Section VII concludes.

Literature review
Debates about financial reporting and accounting standards can seem arcane, tedious and irrelevant. However the current debate about whether IFRS drove banker recklessness is getting interesting. The aims of the literature review to discuss how the accounting standards transform into IFRS in the UK market. It has been debated hotly in financial statements.

Some people have remained the positive attitudes to IFRS. Armstrong et al (2009) suggest that IFRS is highly quality financial reporting relative to application of domestic standards that improve transparency of financial reports and harmonizes accounting. Moreover,