Effect of Cultural Environmental and Accounting Regulation on Earnings Management - Annotated Bibliography Example

Lecturer: The Disciplinary Literacies Project Introduction Cultural values are difficult to transform or change. Culture may refer to the collective programming of the psyche that distinguishes individuals from one another. Everyone has his or her societal customs and norms, which consists of varied features including values system, which many people in the society adopt. Value is the wide tendency of preferring certain affairs over the other. Many scholars adopt these definitions in accounting research in order to develop an effective framework of cultural values for investigating varied differences in the international accounting system. Furthermore, the individual behavior and attitudes influence the organizational performance. The cultural influences explain the behavior and attitudes of individuals in the social systems that have been recognized for a long time. Using fair, cultural value is essential in financial accounting system. The accounting system demands fair values in order to create successful organization performance. Many countries employ cultural and accounting values in managing the accounting system. Thus, understanding the impact cultural values have in the accounting system is crucial because it enables individuals to move towards a clear understanding of international accounting management. Annotated Bibliography Guan, Liming, and Pourjalali, Hamid. "Effect of Cultural Environmental and Accounting Regulation on Earnings Management: a Multiple Year-Country Analysis." Asia-pacific Journal of Accounting and Economics. 17.2 (2010): 99-127. This article takes into considerations the key aspects of cultural values, accounting values, earnings management and multi- country comparisons. The authors reveal the effect of cultural values and disclosure in various countries. Thus, the research study was conducted in order to determine the equity ratio and the way it affects earnings management. The outcomes are reliable with past research studies. The article also analyses the significant effect on the extent of earnings management. The outcome reveals that the greater the values of the amounting variables, the greater the extent of earnings management (Guan and Pourjalali 99). The authors carried out empirical research in order to determine the consequences of cultural values on earnings management in 27 countries. They employed cultural value measures and other environmental variables. Therefore, the results revealed that the cultural values including attitude and behaviors affect the earnings management. The article provided research hypothesis and background for literature materials as well as used varied research design in data collection. It includes the test for the hypothesis and methodological difficulties encountered during the research analysis. Guan and Pourjalali (98) reveals that understanding the effect that cultural values have on financial disclosure and earning management scores is crucial. Many organization fails to achieve effective organization performance and some of them operate at loses. This is because of failure of understanding the significant roles cultural value play in accounting practices. Therefore, the authors provide credible information that will enable one to understand the effect of cultural values in accounting management. The research and empirical testing employed in the research study is vital because they provide empirical evidence on the impact of cultural values on accounting management. The researchers limited their empirical tests to research information that other previous researchers carried out on accounting values because of difficulties in defining quantitatively accounting values. However, from the empirical research studies, the cultural values are likely to shift within the jurisdiction from one period to another. For instance, issues such as economic recession and economic growth can impact the accounting practices and financial reporting of a country but the research study heavily relied on effect of cultural values. The authors provided reliable research information through employing research design methodologies. This enabled them to determine the effect of cultural influences on varied companies from developed nations. They provided sample studies and came up with empirical evidence that cultural values have significant impacts on the accounting management behaviors at the international levels. Nigel Finch Macquarie University. Towards An Understanding of Cultural Influence On The International Practice Of Accounting. Journal of International Business and Cultural Studies (n.d):1-6. The article analyses the issues of cultural influences and its impact on the accounting system. The main issues discussed in the article include cultural influences, value dimensions, accounting and international financial practices. It indicates that cultural influences in the social accounting system in one of the recent study field. The author examines some theoretical cultural influences on the international accounting practices (Nigel Finch Macquarie University 1). It also provides critiques of the current research study methodologies employed in testing the theory of cultural influences. The article employed the use of research methodologies in order to determine the impact of cultural values in the accounting system. It included the use of literature and carried empirical test in order to find the impact of culture on accounting practices. This is essential because it enables an individual to understand the cultural influences towards accounting issues. The article is significant because the author raised credible information on the way cultural values may influence international accounting management practices. The author provides the empirical research with adequate proof for the support of empirical testing and hypotheses. This is credible information towards understanding of cultural influences and their impact on the accounting system. Nigel Finch Macquarie University (2) argues that culture is one of the environmental factors that influence international amounting practices and financial reporting. Therefore, understanding the significant roles that culture play in an organization is essential. This is because cultural values can create a significant impact in the accounting system in case organization does not take them into considerations. Human beings have varied social norm and varied characteristics, but the majority adopt value system in an organization. The important lesson the reader should learn from the above articles is the significance of cultural values in an accounting system and financial reporting. Understanding the impact cultural values has on accounting practices is crucial because it enables the organization to move towards an effective accounting harmonization. Both articles employed Gray’s framework theory of accounting values and the way cultural values affect accounting practices. The Gray framework is a theory that was developed in 1988. It t has increased expectations on the way cultural values influences or affects accounting practices countrywide. Although the empirical research has not provided adequately effective proof to support the empirical tests, the Gray framework has played significant roles towards a better understanding of cultural values in the current international accounting practices. The above sources are legitimate hence they will help the learner to develop effective information, which is credible on the way cultural values impacts the accounting practices and financial reporting in an organization. However, the professions in this field need to achieve adequate ethos or legitimacy through providing adequate evidence from varied nations including developed and developing nations on the way culture may impact accounting practices. This is because cultural values are not static and they may change from one organization to another. This is because of other influences from the internal and external environment; thus the professionals could carry out independent research on the issue of cultural values towards accounting practices. Moreover, the articles depend heavily for the past research analysis; thus they used varied literature to support their research analysis. The legitimacy in research work is essential and it involves showing moral philosophy towards research work activities. The research claims that cultural values impacts accounting but the research lacked theoretical basis in compiling data. Interview Script The project was developed for the study purpose of disciplinary literacy project. The suggested group includes the professional with experience and peer reviews. Interviewer: Student. Interviewee: Professional with cultural value experience. (Start of Interview) Interviewer: What is your profession field? Interviewee: My profession field is on cultural values affecting accounting and financial reporting issues. Interviewer: How do you understand cultural values in accounting practices? Interviewee: Cultural values is a discipline that encompass the behaviors and beliefs; thus it consists of varied features including values system, which many people in the society adopt Interviewer: What is the significant of understanding cultural values in an organization? Interviewee: Understanding the importance of cultural values is essential in an organization because it enables individual to manage and carry out accounting practices effectively. Interviewer: How can culture impact accounting practices and financial reporting? Interviewee: culture can contribute to organization poor financial report and this will impact the organizational performance. Interviewer: What methodological difficulties encountered during the research analysis process? Interviewee: What are the problems encountered when carrying out research study? Interviewer: There are varied problems encountered especially when employing varied research design in data collection. Some research data are time consuming and sometime one may not get clear information because of biased information. Interviewer: How do you intend to carry out future research on the cultural value issues? Interviewee: The future research depends on understanding the past and the present cultural issues affecting the accounting systems (Law and Shek 212). Once one has understood them, it is vital to generate future research and carry out more studies to in order to improve the field of professional culture in accounting practices? Interviewer: What can one do in order to improve the research study on the field of professional culture education? Interviewee: One can improve this through carrying out more research practices and employ varied criteria towards creating cultural change including working as a team, improving creativity and communicating about the problem, thus seeking for solutions. Interviewer: Thanks for the information Interviewee: You are welcome. Work Cited Guan, Liming, and Pourjalali, Hamid. "Effect of Cultural Environmental and Accounting Regulation on Earnings Management: a Multiple Year-Country Analysis." Asia-pacific Journal of Accounting and Economics. 17.2 (2010): 99-127. Print. Law, Ben M. F, and Daniel T. L. Shek. "Validation of the Cultural Influence on Helping Scale Among Chinese Adolescents." Research on Social Work Practice. 21.2 (2011): 212-221. Print. Nigel Finch Macquarie University. Towards An Understanding Of Cultural Influence On The International Practice Of Accounting. Journal of International Business and Cultural Studies (n.d).1-6.Print. Read More