Based on Regulation No. 1606/2002 from the 1st January of 2005 all the stock exchange quoted companies in the European Union had to adopt the International Financial Reporting System (IFRS). In order to prevent possible future accounting scandals like Enron, the purpose of this progress is the creation of the necessary institutional checks and balances in the business system supervision.
The loan loss provisioning is considered the main accrual in the balance sheet of the banks and is one of the factors that characterize the accounting quality of the financial statements of banks. This study is concluded that the loan loss provision as a method to smooth the income of the banks in EU Mediterranean countries has reduced because of the adoption of
IFRS. This happens because the rules in IFRS are strict and try to create more difficulties concerning managers to apply methods that will function just concerning their own benefit
Keywords: IFRS, Banks, Loan Loss Provision, Accounting quality