Author:
Manawadu Isuru,Che Azmi Anna,Mohamed Aslam
Abstract
PurposeThe purpose of this paper is to examine the moderating effect of IFRS adoption on the relationship between foreign direct investment (FDI) and conditional accounting conservatism in South Asia.Design/methodology/approachThis study uses the model developed by Basu (1997) and Ball and Shivakumar (2005) to examine the moderating effect of IFRS adoption on the relationship between FDI and conditional accounting conservatism. Data are tested by running panel generalized method of moments–2SLS estimation for the period of 2006–2015.FindingsA moderating effect of IFRS adoption was found on the relationship between FDI and conditional accounting conservatism in South Asia.Research limitations/implicationsThis study contributes to the literature by adding new evidence on the moderating effect of IFRS adoption on the relationship between FDI and conditional accounting conservatism.Originality/valueThe relationship between FDI and conditional accounting conservatism was moderated by IFRS adoption in South Asia. This finding provides new evidence to the literature as well as for the policy makers to consider on IFRS adoption.
Subject
Sociology and Political Science,Development,Accounting
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