Cultural and noncultural factors affecting judgments of professional accountants

a comparative study of Australia and Fiji

Parmod Chand*, Chris Patel

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

This study extends prior cross-cultural research by examining the effects of both cultural and noncultural factors on the judgments of professional accountants. It examines the extent and the cause of differences in judgments of professional accountants in Australia and Fiji when interpreting and applying selected International Financial Reporting Standards (IFRS). A comparative study between these two countries, which have both adopted IFRS, provides empirical evidence that IFRS are not interpreted and applied consistently. It supports the views that: (a) both national culture and organizational culture (Big 4 and non-Big 4 firm affiliations) have a significant effect on the manner in which professional accountants in a country interpret uncertainty expressions contained in IFRS; and (b) national culture and organizational culture interact to influence the judgments of professional accountants. Further, the results of the effects of noncultural factors on the judgments of professional accountants in Australia and Fiji show that the professional accountants' perceived level of task complexity has a significant effect on their judgments. An important implication of this study is that the adoption of IFRS in different countries alone may not result in uniformity in financial reporting as IFRS may not be consistently applied by those countries because of differences in cultural as well as noncultural factors.

Original languageEnglish
Title of host publicationAchieving global convergence of financial reporting standards
Subtitle of host publication implications from the South pacific region
EditorsP Chand, C Patel
Place of PublicationBingley, UK
PublisherEmerald Group Publishing
Pages105-139
Number of pages35
ISBN (Electronic)9781780524436
ISBN (Print)9781780524429
DOIs
Publication statusPublished - 2011

Publication series

NameStudies in Managerial and Financial Accounting
PublisherEMERALD GROUP PUBLISHING LTD
Volume22
ISSN (Print)1479-3512

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