The past two decades have resulted in an increase in international trade, capital flows and cross-border economic integrations. These phenomena have increased the demand for harmonized international accounting standards aimed at creating an efficient resource allocation, worldwide. The adoption of International Financial Reporting Standards (IFRS) is the result of a process towards a greater accounting harmonization. In Sweden, there are four categories of firms that apply IFRS; three are regulated by law, while the fourth are voluntary applying IFRS. The aim of this study is to find out which factors explain why firms voluntarily apply IFRS. By doing one quantitative and one qualitative study of the firms listed on the Swedish unregulated capital markets, we have found that there are 84 firms that voluntarily apply IFRS, that is 35 percent. The significant factors explaining the voluntarily application of IFRS are the use of an audit firm within the big four (PricewaterhouseCoopers, KPMG, Ernst & Young and Deloitte) and the number of firms within the same industry that voluntarily applies IFRS. Their voluntary application of IFRS has been explained to primarily depend on the advantages increased internal control, a more extensive and detailed annual report and more investors. In addition, the use of IFRS indicates quality and the firm will  be seen as a good corporate citizen.