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The importance in accounting of ambiguity tolerance at the national level

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  • Noel Harding
  • Mingchuan Ren

Abstract

Purpose - The aim of the research is to examine potential differences in the levels of ambiguity tolerance between Australian and Chinese accountants at the national, rather than individual, level. Design/methodology/approach - Ambiguity tolerance levels of final year accounting students (proxying for entry level accountants) and first year accounting students from Australia and China were measured using the MacDonald AT‐20 Ambiguity Tolerance Index. Comparisons were made across the four subject pools with a view to identifying national level differences suggested by the cultural, sociological, historical, and contemporary issues impacting on the accounting profession in the two countries. Findings - Entry level accountants in China are less tolerant of ambiguity than their Australian counterparts. There are, however, no statistically significant differences in the levels of ambiguity tolerance between first year accounting students in China and Australia. Research limitations/implications - The research employed final year accounting students as surrogates for entry level accountants. Future research could usefully extend this research to practicing accountants at different ranks. Practical implications - Given the central role of ambiguity in contemporary accounting practice, the potential implications are broad. This is particularly the case with regard to the harmonization of accounting practices in that accountants with different tolerances for ambiguity might make different decisions in the face of similar accounting standards and circumstances. Interestingly, the results from the research suggest that differences in ambiguity tolerance are attributable to events occurring while students are studying. Originality/value - This research examines ambiguity tolerance at the national level (rather than the individual level), thereby allowing practical implications to be prescribed.

Suggested Citation

  • Noel Harding & Mingchuan Ren, 2007. "The importance in accounting of ambiguity tolerance at the national level," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 15(1), pages 6-24, January.
    • Handle: RePEc:eme:arapps:v:15:y:2007:i:1:p:6-24
    DOI: 10.1108/13217340710763726
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    References listed on IDEAS

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    1. Carpenter, Brian & Dirsmith, Mark, 1993. "Sampling and the abstraction of knowledge in the auditing profession: An extended institutional theory perspective," Accounting, Organizations and Society, Elsevier, vol. 18(1), pages 41-63, January.
    2. Harding, Noel & Mckinnon, Jill, 1997. "User involvement in the standard-setting process: A research note on the congruence of accountant and user perceptions of decision usefulness," Accounting, Organizations and Society, Elsevier, vol. 22(1), pages 55-67, January.
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    Cited by:

    1. Arquero, José Luis & Fernández-Polvillo, Carmen & Hassall, Trevor & Joyce, John, 2017. "Relationships between communication apprehension, ambiguity tolerance and learning styles in accounting students," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 20(1), pages 13-24.
    2. Fred Pries & Ron Baker, 2010. "A Proposal for Teaching Introductory and Intermediate Accounting in an Environment of International Financial Reporting Standards and Generally Accepted Accounting Principles for Private Enterprises," Accounting Perspectives, John Wiley & Sons, vol. 9(1), pages 15-27, March.

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