Publication Type
Journal Article
Version
Preprint
Publication Date
5-2014
Abstract
Using an international sample of banks and country-level indices for individualism and uncertainty avoidance as proxies for national culture, we study how differences in culture across countries affect accounting conservatism and bank risk-taking. Consistent with expectations, our cross-country analysis indicates that individualism is negatively (positively) related to conservatism (risk-taking) and uncertainty avoidance is positively (negatively) related to conservatism (risk-taking). We also find that cultures that encourage higher risk-taking experienced more bank failures and bank troubles during the recent financial crisis.
Keywords
national culture, accounting conservatism, risk-taking, individualism, uncertainty avoidance, banking
Discipline
Accounting | Finance and Financial Management
Research Areas
Corporate Governance, Auditing and Risk Management
Publication
Accounting Review
Volume
89
Issue
3
First Page
1115
Last Page
1149
ISSN
0001-4826
Identifier
10.2308/accr-50682
Publisher
American Accounting Association
Citation
KIRIDARAN, Kanagaretn; LIM, Chee Yeow; and LOBO, Gerald J..
Influence of National Culture on Accounting Conservatism and Risk-Taking in the Banking Industry. (2014). Accounting Review. 89, (3), 1115-1149.
Available at: https://ink.library.smu.edu.sg/soa_research/1112
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
http://doi.org/10.2308/accr-50682