Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh
This study examines the antecedents and effects of creative accounting practices (CAP) on organizational outcomes in Bangladesh. Thus, this research recognizes the antecedents of creative accounting, such as sustainable financial data (SFD), political connections (PC), corporate ethical values (CEV)...
| Main Authors: | , , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Elsevier
2023-02-01
|
| Series: | Heliyon |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S2405844023009660 |
| _version_ | 1811161699173007360 |
|---|---|
| author | Muhammad Shajib Rahman Md Jahid Hasan Md Saddam Hossain Khan Ishrat Jahan |
| author_facet | Muhammad Shajib Rahman Md Jahid Hasan Md Saddam Hossain Khan Ishrat Jahan |
| author_sort | Muhammad Shajib Rahman |
| collection | DOAJ |
| description | This study examines the antecedents and effects of creative accounting practices (CAP) on organizational outcomes in Bangladesh. Thus, this research recognizes the antecedents of creative accounting, such as sustainable financial data (SFD), political connections (PC), corporate ethical values (CEV), future company orientations (FCO), and corporate governance practices (CGP). And also examine how the quality of financial reporting (QFR) and decision-making effectiveness (DME) are influenced by CAP. This study incorporates these fundamental antecedents of creative accounting practices on organizational outcomes by collecting survey data (n = 354) from publicly traded companies in the Dhaka Stock Exchange (DSE), Bangladesh. The study model has been tested through the “Partial Least Square- Structural Equation Modelling” (PLS-SEM) technique using Smart PLS v3.3 software. In addition, we pass various model fit measures, i.e., reliability, validity, factor analysis, and goodness of fit. This study finds that SFD does not work as an antecedent of creative accounting practices. But, the outcomes of the PLS-SEM confirm that PC, CEV, CFO and CGP work as an antecedent of CAP. Furthermore, the results of PLS-SEM also confirm that CAP influence the QFR in the positive direction and CAP influence the DME in the negative direction. Finally, QFR has a positive and significant impact on DME. Any study that has tested the impact of CAP on QFR & DME is yet to be found in the literature. However, policymakers, accounting bodies, regulators, and investors can consider these findings to formulate policy and investment decisions. Mainly, organizations can focus on PC, CEV, CFO and CGP to reduce CAP. But organizations need QFR and DME, which are critical components of organizational outcomes. |
| first_indexed | 2024-04-10T06:18:35Z |
| format | Article |
| id | doaj.art-7c0293ad04e2403792ecaa4141b4ae03 |
| institution | Directory Open Access Journal |
| issn | 2405-8440 |
| language | English |
| last_indexed | 2024-04-10T06:18:35Z |
| publishDate | 2023-02-01 |
| publisher | Elsevier |
| record_format | Article |
| series | Heliyon |
| spelling | doaj.art-7c0293ad04e2403792ecaa4141b4ae032023-03-02T05:02:41ZengElsevierHeliyon2405-84402023-02-0192e13759Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from BangladeshMuhammad Shajib Rahman0Md Jahid Hasan1Md Saddam Hossain Khan2Ishrat Jahan3Department of Accounting & Information Systems, Comilla University, Cumilla, Bangladesh; Corresponding author.Department of Management Studies, Comilla University, Cumilla, BangladeshFaculty Member, Bangladesh Academy for Securities Markets, BangladeshDepartment of Business Administration, Victoria University of Bangladesh, BangladeshThis study examines the antecedents and effects of creative accounting practices (CAP) on organizational outcomes in Bangladesh. Thus, this research recognizes the antecedents of creative accounting, such as sustainable financial data (SFD), political connections (PC), corporate ethical values (CEV), future company orientations (FCO), and corporate governance practices (CGP). And also examine how the quality of financial reporting (QFR) and decision-making effectiveness (DME) are influenced by CAP. This study incorporates these fundamental antecedents of creative accounting practices on organizational outcomes by collecting survey data (n = 354) from publicly traded companies in the Dhaka Stock Exchange (DSE), Bangladesh. The study model has been tested through the “Partial Least Square- Structural Equation Modelling” (PLS-SEM) technique using Smart PLS v3.3 software. In addition, we pass various model fit measures, i.e., reliability, validity, factor analysis, and goodness of fit. This study finds that SFD does not work as an antecedent of creative accounting practices. But, the outcomes of the PLS-SEM confirm that PC, CEV, CFO and CGP work as an antecedent of CAP. Furthermore, the results of PLS-SEM also confirm that CAP influence the QFR in the positive direction and CAP influence the DME in the negative direction. Finally, QFR has a positive and significant impact on DME. Any study that has tested the impact of CAP on QFR & DME is yet to be found in the literature. However, policymakers, accounting bodies, regulators, and investors can consider these findings to formulate policy and investment decisions. Mainly, organizations can focus on PC, CEV, CFO and CGP to reduce CAP. But organizations need QFR and DME, which are critical components of organizational outcomes.http://www.sciencedirect.com/science/article/pii/S2405844023009660Creative accountingSustainable financial dataPolitical connectionsFuture company orientationsCorporate ethical valuesCorporate governance practices |
| spellingShingle | Muhammad Shajib Rahman Md Jahid Hasan Md Saddam Hossain Khan Ishrat Jahan Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh Heliyon Creative accounting Sustainable financial data Political connections Future company orientations Corporate ethical values Corporate governance practices |
| title | Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh |
| title_full | Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh |
| title_fullStr | Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh |
| title_full_unstemmed | Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh |
| title_short | Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh |
| title_sort | antecedents and effect of creative accounting practices on organizational outcomes evidence from bangladesh |
| topic | Creative accounting Sustainable financial data Political connections Future company orientations Corporate ethical values Corporate governance practices |
| url | http://www.sciencedirect.com/science/article/pii/S2405844023009660 |
| work_keys_str_mv | AT muhammadshajibrahman antecedentsandeffectofcreativeaccountingpracticesonorganizationaloutcomesevidencefrombangladesh AT mdjahidhasan antecedentsandeffectofcreativeaccountingpracticesonorganizationaloutcomesevidencefrombangladesh AT mdsaddamhossainkhan antecedentsandeffectofcreativeaccountingpracticesonorganizationaloutcomesevidencefrombangladesh AT ishratjahan antecedentsandeffectofcreativeaccountingpracticesonorganizationaloutcomesevidencefrombangladesh |