Country Differences in Earnings Management Intensity: The Influence of Culture

This paper explores the influence of legal and cultural characteristics on differences in earnings management intensity across countries. The results largely support the intuition that national culture matters and that a larger inclusion of cultural variables in explaining international differences in financial reporting practices is desirable, which suggests that the on-going process of global convergence of accounting standards should leave more space for the expression of national cultural features rather than imposing standards derived from a dominant but specific cultural environment.