Corruption, Accounting Practice and Economic Growth: Evidence of ASEAN Countries

DOI

10.2991/aebmr.k.200812.016How to use a DOI?

Keywords

corruption, accounting practice, economic growth

Abstract

This study analyzes the impact of corruption on economic growth by including the role of accounting practices. Corruption has a negative influence on economic growth in countries with poor quality accounting practices than in countries with high-quality accounting practices. The new contribution of this study concerns the relationship between the literature between corruption and separate accounting practices regarding economic growth. To our knowledge, this is a study of the first ASEAN countries documenting the impact of corruption on economic growth that depends on the quality of accounting practices in a country. We use cross-section data for 2018 for 11 ASEAN countries. Data on economic growth is taken from the World Bank, while corruption is represented by the Transparency International (TI) Corruption Perception Index (CPI). Meanwhile accounting practices are represented by the strength of auditing standards and financial reporting from the World Economic Forum (WEF), as well as the adoption of the International Public Sector Accounting Standards (IPSAS) in a country from the International Federation of Accountants (IFAC). We apply the Moderated Regression Analysis (MRA) approach for estimating results. The results of studies show that corruption inhibits economic growth. In addition, the strength of auditing standards and financial reporting weakens the relationship between corruption and economic growth. Other results show that the adoption of IPSAS does not weaken the relationship of corruption with economic growth in ASEAN countries. The findings of this study prove that high-quality accounting practices in a country can weaken corruption which can hamper economic growth. Conversely, corruption will easily grow in countries with weak quality accounting practices whose impact will hamper economic growth.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Dendy Syaiful Akbar
AU  - Dede Abdul Rozak
AU  - Benny Prawiranegara
AU  - Eva Faridah
PY  - 2020
DA  - 2020/08/13
TI  - Corruption, Accounting Practice and Economic Growth: Evidence of ASEAN Countries
BT  - Proceedings of the 3rd Asia Pacific Management Research Conference (APMRC 2019)
PB  - Atlantis Press
SP  - 81
EP  - 88
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200812.016
DO  - 10.2991/aebmr.k.200812.016
ID  - Akbar2020
ER  -