Accounting enforcement in a national context

an international study

Gary Kleinman, Beixin Lin, Rebecca Bloch

Research output: Contribution to journalArticleResearchpeer-review

Abstract

The purpose of this study is to investigate whether the national characteristics of culture, religion and political factionalization are associated with the strength of accounting enforcement. The study uses data on percentages of religious adherents in a sample nation, the Hofstede cultural dimensions and political factionalization. National legal code (e.g., Common Law or Civic Code) and market liquidity are controlled for. Factor analysis is used to generate factor scores from the data. The dependent variable, accounting enforcement, is drawn from Brown et al. (J Bus Finance Account 41(1/2):1–52, 2014). The findings demonstrate that this set of national characteristics is strongly associated with national accounting regulatory enforcement. The implications of this research are that national characteristics should be taken into account in considering the impact of accounting standards on accounting comparability across nations. The limitation of this study is that, like much international research, the sample size is limited, here to 42 nations. The authors collectively have many years of research examining/studying domestic and international regulation, its determinants and consequences. This study importantly extends previous research on the determinants and consequences of regulation in the auditing and accounting arenas. This study provides an important contribution to the literature by helping establish that national characteristics do affect accounting enforcement efforts cross-nationally. This helps researchers and regulators better understand whether international standards can provide the link in comparability across nations that proponents are seeking. It does so by focusing on the variation in enforcement across nations rather than on the standards themselves.

Original languageEnglish
Pages (from-to)47-67
Number of pages21
JournalInternational Journal of Disclosure and Governance
Volume16
Issue number1
DOIs
StatePublished - 7 Mar 2019

Fingerprint

National context
Enforcement
International studies
Finance
Cultural dimensions
Factor scores
Auditing
Bus
Hofstede
International regulation
Market liquidity
Common law
National accounting
Regulatory enforcement
International standards
International research
Sample size
Accounting standards
Factor analysis

Keywords

  • Accounting enforcement
  • Accounting quality
  • Culture
  • IFRS
  • Political factionalization
  • Regulation
  • Religion

Cite this

@article{064ca9a0430e44539e2a159fa5f90517,
title = "Accounting enforcement in a national context: an international study",
abstract = "The purpose of this study is to investigate whether the national characteristics of culture, religion and political factionalization are associated with the strength of accounting enforcement. The study uses data on percentages of religious adherents in a sample nation, the Hofstede cultural dimensions and political factionalization. National legal code (e.g., Common Law or Civic Code) and market liquidity are controlled for. Factor analysis is used to generate factor scores from the data. The dependent variable, accounting enforcement, is drawn from Brown et al. (J Bus Finance Account 41(1/2):1–52, 2014). The findings demonstrate that this set of national characteristics is strongly associated with national accounting regulatory enforcement. The implications of this research are that national characteristics should be taken into account in considering the impact of accounting standards on accounting comparability across nations. The limitation of this study is that, like much international research, the sample size is limited, here to 42 nations. The authors collectively have many years of research examining/studying domestic and international regulation, its determinants and consequences. This study importantly extends previous research on the determinants and consequences of regulation in the auditing and accounting arenas. This study provides an important contribution to the literature by helping establish that national characteristics do affect accounting enforcement efforts cross-nationally. This helps researchers and regulators better understand whether international standards can provide the link in comparability across nations that proponents are seeking. It does so by focusing on the variation in enforcement across nations rather than on the standards themselves.",
keywords = "Accounting enforcement, Accounting quality, Culture, IFRS, Political factionalization, Regulation, Religion",
author = "Gary Kleinman and Beixin Lin and Rebecca Bloch",
year = "2019",
month = "3",
day = "7",
doi = "10.1057/s41310-019-00056-y",
language = "English",
volume = "16",
pages = "47--67",
journal = "International Journal of Disclosure and Governance",
issn = "1741-3591",
publisher = "Palgrave Macmillan Ltd.",
number = "1",

}

Accounting enforcement in a national context : an international study. / Kleinman, Gary; Lin, Beixin; Bloch, Rebecca.

In: International Journal of Disclosure and Governance, Vol. 16, No. 1, 07.03.2019, p. 47-67.

Research output: Contribution to journalArticleResearchpeer-review

TY - JOUR

T1 - Accounting enforcement in a national context

T2 - an international study

AU - Kleinman, Gary

AU - Lin, Beixin

AU - Bloch, Rebecca

PY - 2019/3/7

Y1 - 2019/3/7

N2 - The purpose of this study is to investigate whether the national characteristics of culture, religion and political factionalization are associated with the strength of accounting enforcement. The study uses data on percentages of religious adherents in a sample nation, the Hofstede cultural dimensions and political factionalization. National legal code (e.g., Common Law or Civic Code) and market liquidity are controlled for. Factor analysis is used to generate factor scores from the data. The dependent variable, accounting enforcement, is drawn from Brown et al. (J Bus Finance Account 41(1/2):1–52, 2014). The findings demonstrate that this set of national characteristics is strongly associated with national accounting regulatory enforcement. The implications of this research are that national characteristics should be taken into account in considering the impact of accounting standards on accounting comparability across nations. The limitation of this study is that, like much international research, the sample size is limited, here to 42 nations. The authors collectively have many years of research examining/studying domestic and international regulation, its determinants and consequences. This study importantly extends previous research on the determinants and consequences of regulation in the auditing and accounting arenas. This study provides an important contribution to the literature by helping establish that national characteristics do affect accounting enforcement efforts cross-nationally. This helps researchers and regulators better understand whether international standards can provide the link in comparability across nations that proponents are seeking. It does so by focusing on the variation in enforcement across nations rather than on the standards themselves.

AB - The purpose of this study is to investigate whether the national characteristics of culture, religion and political factionalization are associated with the strength of accounting enforcement. The study uses data on percentages of religious adherents in a sample nation, the Hofstede cultural dimensions and political factionalization. National legal code (e.g., Common Law or Civic Code) and market liquidity are controlled for. Factor analysis is used to generate factor scores from the data. The dependent variable, accounting enforcement, is drawn from Brown et al. (J Bus Finance Account 41(1/2):1–52, 2014). The findings demonstrate that this set of national characteristics is strongly associated with national accounting regulatory enforcement. The implications of this research are that national characteristics should be taken into account in considering the impact of accounting standards on accounting comparability across nations. The limitation of this study is that, like much international research, the sample size is limited, here to 42 nations. The authors collectively have many years of research examining/studying domestic and international regulation, its determinants and consequences. This study importantly extends previous research on the determinants and consequences of regulation in the auditing and accounting arenas. This study provides an important contribution to the literature by helping establish that national characteristics do affect accounting enforcement efforts cross-nationally. This helps researchers and regulators better understand whether international standards can provide the link in comparability across nations that proponents are seeking. It does so by focusing on the variation in enforcement across nations rather than on the standards themselves.

KW - Accounting enforcement

KW - Accounting quality

KW - Culture

KW - IFRS

KW - Political factionalization

KW - Regulation

KW - Religion

UR - http://www.scopus.com/inward/record.url?scp=85061267567&partnerID=8YFLogxK

U2 - 10.1057/s41310-019-00056-y

DO - 10.1057/s41310-019-00056-y

M3 - Article

VL - 16

SP - 47

EP - 67

JO - International Journal of Disclosure and Governance

JF - International Journal of Disclosure and Governance

SN - 1741-3591

IS - 1

ER -