Use this URL to cite or link to this record in EThOS:
Title: Economic consequences of accounting standards : implications for the Saudi Organization for Certified Public Accountants (SOCPA)
Author: Al-Moghaiwli, Mohammed Hamed
ISNI:       0000 0001 3407 2537
Awarding Body: Aberystwyth University
Current Institution: Aberystwyth University
Date of Award: 1999
Availability of Full Text:
Access from EThOS:
Access from Institution:
This study aims at collecting empirical evidence on whether or not financial accounting standards which exist in the Kingdom of Saudi Arabia give rise to economic consequences. Awareness of the potential economic consequences of accounting standards emerged first in the United States of America in the 1970s, but increasingly has attracted a great deal of attention in many different countries over the last twenty years. The impact of accounting standards on management behaviour has been cited as one of the consequences. Factors that affect management's attitudes in choosing among alternative accounting methods are established through the political cost theory and the contracting and agency theories. Using these theories, this study hypothesises that company size, the presence of Government debt and/or donations, the ratio of foreign employees to total employees, the presence of management compensation plans, and insider ownership provide incentives for the management of Saudi joint stock companies to adopt income-increasing or - decreasing accounting policies. The results of the univariate and multivariate tests show that company size, ratios of foreign employees to total employees, and insider ownership are significant determinants of inventory, research and development, and Zakat policies. These findings provide empirical support for the principal hypothesis of this thesis. That is, accounting standards which exist in Saudi Arabia give rise to economic consequences and managers of companies consider these consequences when selecting accounting policies. In summary, this principal conclusion is of critical importance to the Saudi Organization for Certified Public Accountants (SOCPA), given that accounting standard setting processes are still in their early stages of development. It supports the view that SOCPA should acknowledge the possible adverse economic consequences that may result from its accounting standards decisions. In fact, the results of this study justify, in the very least, a wider and more detailed study by SOCPA of the economic effects of its potential accounting standards. The findings may also call into question the financial accounting standards which have been recently promulgated in Saudi Arabia.
Supervisor: Tippett, Mark Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: Economics & economic theory