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The impact of the adoption of international accounting and auditing standards on corruption perception

Elisabeth Penti Kurniawati (Doctoral Program, Faculty of Economics and Business, Gadjah Mada University, Yogyakarta, Indonesia and Department of Accounting, Satya Wacana Christian University, Salatiga, Indonesia)
Didi Achjari (Department of Accounting, Gadjah Mada University, Yogyakarta, Indonesia)

Accounting Research Journal

ISSN: 1030-9616

Article publication date: 29 April 2022

Issue publication date: 29 November 2022

254

Abstract

Purpose

This study aims to investigate the impact of the adoption of international accounting and auditing standards on corruption perception. In addition, this study examines the strength of auditing and reporting standards (SARS) that mediate the relationship.

Design/methodology/approach

Agency theory and bonding theory were applied in this paper to investigate the impact of the adoption of international accounting and auditing standards on corruption perception. Data from 130 countries during three years were collected from Transparency International, Worldwide Governance Indicators, International Federation of Accountants, World Economic Forum, World Bank, Freedom House and World Justice Project. Hypotheses were tested using partial least squares structural equation modeling.

Findings

The results show a positive impact of the adoption of international accounting and auditing standards on corruption perception, directly and indirectly, through the SARS.

Practical implications

The results provide an insight into corruption eradication strategy through the adoption of international accounting and auditing standards and strengthen the auditing and reporting standards.

Originality/value

This study is distinctive, as no study has yet examined the impact of the adoption of international accounting standards construct, which contains International Financial Reporting Standards and International Standards on Auditing, on the corruption perception. The corruption perception construct is developed by combining the corruption perception index and the control of corruption indicators.

Keywords

Acknowledgements

The authors are grateful for the valuable and insightful comments and suggestions offered by the anonymous reviewers. We are also grateful to Gadjah Mada University for providing database and proofreading services.

Citation

Kurniawati, E.P. and Achjari, D. (2022), "The impact of the adoption of international accounting and auditing standards on corruption perception", Accounting Research Journal, Vol. 35 No. 6, pp. 737-755. https://doi.org/10.1108/ARJ-08-2021-0230

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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