Choice of Inventory Accounting Method under IFRS: An Empirical Study from the Perspective of Positive Accounting Theory

Abstract

This study aims to explore how firm-specific factors influence managers’ choice of inventory accounting methods under international accounting standards/ international financial reporting standards (IAS/IFRS) from a positive accounting theory perspective. A total of 921 companies from 11 different countries are included for the financial year of 2019. Multiple regression is used to test the impact of explanatory variables on the choice of inventory accounting method. The results demonstrate that SIZE and CINT influence the choice of FIFO negatively.