Abstract
| Original language | English |
|---|---|
| Article number | 100834 |
| Journal | British Accounting Review |
| Volume | 51 |
| Issue number | 5 |
| Early online date | 8 May 2019 |
| DOIs | |
| Publication status | Published - Sep 2019 |
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Keywords
- Accounting practice
- Fiscal decentralization
- Corruption
- Public sector accounting
- Financial reporting standards
- IPSASs
- PUBLIC-SECTOR
- MANAGEMENT
- POLITICAL DECENTRALIZATION
- INFORMATION
- DEMOCRACY
- PRESS FREEDOM
- CHOICE
- COMPETITION
- GOVERNMENT
- INSTITUTIONAL THEORY
Cite this
Accounting practice, fiscal decentralization and corruption. / Changwony, Fredrick Kibon; Paterson, Audrey S.
In: British Accounting Review, Vol. 51, No. 5, 100834, 09.2019.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Accounting practice, fiscal decentralization and corruption
AU - Changwony, Fredrick Kibon
AU - Paterson, Audrey S
PY - 2019/9
Y1 - 2019/9
N2 - In prior studies, accounting and decentralization corruption solutions have so far been analysed in isolation. In this article, we connect these two strands of literature on corruption. Understanding this connection is important because weak financial accounting and reporting systems can inhibit monitoring incentives and thus reduce decentralization benefits in countering corruption. We argue that the effectiveness of decentralization as an anti-corruption barrier is complemented by the quality of the accounting practice in a country. Using multiple sources of data, we find that decentralization has a positive and increasing effect on reducing corruption among countries with a high-quality accounting practice. In contrast, decentralization has a negative and decreasing effect on reducing corruption among countries with weak-quality accounting practices. These findings are robust to alternative measures of accounting, decentralization and corruption and to endogeneity tests. Our findings demonstrate the crucial information role of accounting in enhancing decentralization monitoring mechanisms and in thereby reducing corruption.
AB - In prior studies, accounting and decentralization corruption solutions have so far been analysed in isolation. In this article, we connect these two strands of literature on corruption. Understanding this connection is important because weak financial accounting and reporting systems can inhibit monitoring incentives and thus reduce decentralization benefits in countering corruption. We argue that the effectiveness of decentralization as an anti-corruption barrier is complemented by the quality of the accounting practice in a country. Using multiple sources of data, we find that decentralization has a positive and increasing effect on reducing corruption among countries with a high-quality accounting practice. In contrast, decentralization has a negative and decreasing effect on reducing corruption among countries with weak-quality accounting practices. These findings are robust to alternative measures of accounting, decentralization and corruption and to endogeneity tests. Our findings demonstrate the crucial information role of accounting in enhancing decentralization monitoring mechanisms and in thereby reducing corruption.
KW - Accounting practice
KW - Fiscal decentralization
KW - Corruption
KW - Public sector accounting
KW - Financial reporting standards
KW - IPSASs
KW - PUBLIC-SECTOR
KW - MANAGEMENT
KW - POLITICAL DECENTRALIZATION
KW - INFORMATION
KW - DEMOCRACY
KW - PRESS FREEDOM
KW - CHOICE
KW - COMPETITION
KW - GOVERNMENT
KW - INSTITUTIONAL THEORY
U2 - 10.1016/j.bar.2019.04.003
DO - 10.1016/j.bar.2019.04.003
M3 - Article
VL - 51
JO - British Accounting Review
JF - British Accounting Review
SN - 0890-8389
IS - 5
M1 - 100834
ER -