Legal Translation and Readability

Abstract

It would be interesting if legal translation readability could be compared between the new and the older version of a certain legal text, especially if authorities make efforts to make legal documents more accessible to the general public. One such area is accounting. It is often said that accounting is just ‘number crunching’ or ‘bean counting’. These negative stereotypes against accounting are deeply rooted in the notion that accounting is only about numbers. Since the 2002 accounting scandal in American and the subsequent financial crises in other parts of the world, demand for more readable accounting information has been on the rise. The International Financial Reporting Standards (IFRS) Foundation states that understandability is required for financial information to be useful, but when it comes to translating the IFRS into local languages the IFRS seems to stick to one single translation strategy: word-for-word. This study finds that the readability of the IFRS translation is significantly lower than the local accounting standards and makes the following implications. First, IFRS translation policy needs to be more flexible in its translation policy. Second, regulators need to pay more attention to the readability of firms’ financial reporting during the transition to new rules and regulations.