Digital Accounting Transformation and Financial Reporting Quality: Evidence from Emerging Economies
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Digital Accounting Transformation and Financial Reporting Quality: Evidence from Emerging Economies
Mr. Manoj Kumar
Assistant Professor, School of Business Management,
Chhatrapati Shahu Ji Maharaj University, Kanpur
Mr. Rahul Agarwal
Assistant Professor, School of Business Management,
Chhatrapati Shahu Ji Maharaj University, Kanpur
Abstract
The global transition from traditional accounting to digital accounting systems has transformed how organizations record, process, and report financial information. This study investigates the impact of digital accounting adoption on the quality of financial reporting among listed firms in emerging economies. Using panel data from 180 publicly traded companies across India, Indonesia, and South Africa between 2014 and 2023, this research employs a combination of accrual-based earnings management models and structural equation modeling (SEM) to assess whether digital accounting systems enhance transparency, comparability, and reliability of financial disclosures. The results reveal that firms with higher digitalization maturity report significantly lower discretionary accruals, improved timeliness of disclosures, and enhanced stakeholder confidence. The study provides theoretical contributions to the diffusion of innovation theory in accounting and practical implications for regulators and policymakers seeking to strengthen financial integrity in developing markets.
Keywords: Digital Accounting, Financial Reporting Quality, Emerging Economies, Earnings Management, IFRS, Technology Adoption