The Cultural Aspect of Differences in Company Performance across Countries: Gray’s Accounting Values Contribute more than Hofstede’s Original Cultural Dimensions

摘要

Comparability through uniform accounting standards is one of IASB’s goals, but several country-wise differences make this hard, even across companies in countries prescribing the same accounting regime, like IFRS. Among other issues, the performance measures, ROA, Tobin’s Q, Earnings-to-Enterprise Value and Sales-to-Enterprise, are affected by culture as expressed by both Hofstede and Gray. We selected financial data from 22,445 companies in 95 countries from the global ORBIS-database, and available information from PWC on the country-wise use and implementation of IFRS. We found a clear cultural effect explaining the differences in company performance across countries and accounting regimes, and that the Gray accounting values are apparently marginally preferable than the Hofstede cultural indicators.