This study examines the determinants and consequences of voluntary adoption of non-local accounting principles (non-local gaap) by firms listed and domiciled in the european union (eu). We restrict ourselves to the two predominant internationally accepted sets of accounting standards: international accounting standards (ias) and united states generally accepted accounting principles (us gaap). We have used various sources to identify eu firms that use non-local gaap. We examine the 1999 annual reports of all these firms, because accounting standard choices in more recent years may be affected by the announcement of the proposal by the european commission in february 2001 to mandate ias usage from 2005 on. The maintained hypothesis is that firms that voluntarily adopt ias or us gaap expect to experience net benefits from adoption. The finding that 133 non-financial firms in the eu voluntarily used non-local gaap in 1999 suggests that the majority of listed eu firms does not expect to benefit from non-local gaap adoption. By studying the characteristics of non-local gaap adopters this study provides insight into the determinants of non-local gaap adoption. We find that firms voluntarily using non-local gaap are more likely to be listed on a us exchange, the easdaq exchange in brussels, and have more geographically dispersed operations. Furthermore, they are more likely to be domiciled in a country with lower quality financial reporting and where ias is explicitly allowed as an alternative to local gaap. We also study whether non-local gaap adopters have lower levels of information asymmetry, a much cited benefit of using more transparent financial reporting, than non-adopters. We examine three proxies for information asymmetry: analyst following, cost of equity capital, and uncertainty among analysts and investors (forecast dispersion and stock return volatility). We document a positive effect of non-local gaap adoption on analyst following, but fail to find evidence of a lower cost of capital for non-local gaap adopters. Contrary to expectations, uncertainty among analysts and investors appears to be higher for firms using ias or us gaap than for firms using local gaap. However, by comparing ‘early’ and ‘late’ adopters, we find some evidence that suggests that benefits take some time to fully materialise.