IDEAS home Printed from https://ideas.repec.org/a/taf/oabmxx/v9y2022i1p2141092.html
   My bibliography  Save this article

Early compliance with IFRS 16, earnings management, and corruption: evidence from Southeast Asia

Author

Listed:
  • Fuad Fuad
  • Agung Juliarto
  • Andrian Budi Prasetyo
  • Ali Riza Fahlevi

Abstract

The primary purpose of this paper is twofold: firstly, to investigate the effect of early compliance with International Financial Reporting Standards 16 on Leases on earnings management and firm performance; secondly, to examine the moderating roles of corruption environment on those relationships. We test our hypotheses by investigating 1071 industrial firms in Southeast Asian countries, including Indonesia, Malaysia, Singapore, Thailand, and Vietnam using multivariate analyses. Our findings suggest that companies with lower governance mechanisms and looser institutional backgrounds are more likely to find that IFRS implementation may provide less room for management to maximize their short-term gain by manipulating earnings. Nevertheless, we do not find a similar pattern among the firms with low corruption culture. We also observe that firms’ performance in high corruption culture imposing early implementation of IFRS 16 is significantly higher than firms in low corruption culture. The results provide valuable input to the standard setters and regulators to consider the importance of a strong institutional framework in ensuring IFRS’s effective implementation.

Suggested Citation

  • Fuad Fuad & Agung Juliarto & Andrian Budi Prasetyo & Ali Riza Fahlevi, 2022. "Early compliance with IFRS 16, earnings management, and corruption: evidence from Southeast Asia," Cogent Business & Management, Taylor & Francis Journals, vol. 9(1), pages 2141092-214, December.
    • Handle: RePEc:taf:oabmxx:v:9:y:2022:i:1:p:2141092
    DOI: 10.1080/23311975.2022.2141092
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23311975.2022.2141092
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23311975.2022.2141092?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Maria Aluchna & Bogumił Kamiński & Małgorzata Wrzosek, 2024. "Anti-corruption disclosure: evidence from the natural experiment of the Non-Financial Reporting Directive," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 51(2), pages 165-182, June.
    2. Sherif Elhalaby & Adel Sarea & Awwad Alnesafi & Mujeeb Saif Mohsen Al-Absy, 2023. "The Adoption of AAOIFI Standards by Islamic Banks: Understanding the Microeconomic Consequences," Economies, MDPI, vol. 11(2), pages 1-22, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oabmxx:v:9:y:2022:i:1:p:2141092. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://cogentoa.tandfonline.com/OABM20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.