This chapter analyses the political and economic impact of IFRS adoption in the Czech Republic. It contributes to the current understanding of IFRS adoption from the perspective of small European transitional market, where local accounting standards were previously well developed and still play a major role in financial reporting mainly, however for local taxation puroses. Although there has been an observable increase in country's export, FDI and international trade since the beginning of 1990s, the direct impact IFRS is difficult to discern, because of many political and institutional changes that have taken place concurrently. However, it is clear can be stated that adoption of IFRS gas contributed to greater cultivation of economic environment and fscilitated international operations. The IFRS adoption is highly prevalent but it is gradually increasing. This is apparent mainly in Czech companies with foreign parents that are in anz event required to report in IFRS.