Can IFRS Adoption Help Curb Corruption? A Spillover Effect Perspective
Author(s)
Kofi Konadu Tenkorang , Shuibin GU , Michael K. Kesse Somuah ,
Download Full PDF Pages: 188-204 | Views: 539 | Downloads: 170 | DOI: 10.5281/zenodo.5036323
Abstract
Many evidences witnessed that the adoption of International Financial Reporting Standards (IFRS) by countries promotes transparency and attracts international capitals. However, whether it may have a positive spillover effect beyond accounting practices in reducing corruption receives scant attention and is worth studying. Using a sample of unbalanced panel of 37 African countries from the WGI- World bank over the period 2002-2016, we found that IFRS adoption from the samples in Africa has a positive impact on corruption. We further found out that the corruption curbing effect of IFRS adoption was stronger in British colonization countries and better law enforcement countries in Africa.
The findings of the study will enlighten the countries which have adopted IFRS to strengthen their law enforcement to maximize the positive effect of IFRS, and will give inspirations and guidance to the countries which are yet to adopt IFRS as a tool of financial protection and management to consider adopting it.
Keywords
Corruption, IFRS Adoption, Rule of law, Economic development, Colonization.
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