Empirical Study on the Impact of Culture on Accounting Practices: Does it Disappear After the Introduction of IFRS
Keywords:
Accounting Practices, Culture and IFRS Adoption.Abstract
Related to the evidence found in previous investigations of cultural influences on accounting practices, this paper tries to analyze whether cultural differences across countries can be an explanation for differences in accounting practices across countries. The goal of this paper is not to examine accounting differences prior to IFRS adoption, but rather to use evidence found in the previous research as a guidance to find cultural impacts on IFRS implementation. It aims to answer the research question: “Does culture have an influence on accounting practices especially IFRS practices? Theory suggests that cultural impact on accounting practices will disappear due to the standardization of accounting practices after the introduction of IFRS (Nobes and Parker, 2004; Deegan, 2009). I will try to answer the question whether the impact of culture is different in studies that incorporate IFRS in their research design as compared to studies that do not. The focus is on studies which use the Hofstede-Gray framework (1988) that relates culture and
accounting values to accounting systems and practices. The accounting systems / practices are concerned with four different areas namely authority, enforcement, measurements and information disclosures.
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