The impact of IPSAS adoption on reducing corruption: a comprehensive study of global effects

Purpose This study aims to rigorously examine the influence of international public sector accounting standards (IPSAS) on corruption levels across various global contexts. Design/methodology/approach The study employs a system-generalised method of moments (S-GMM) econometric model to analyse an extensive dataset covering 134 countries from 2004 to 2023. This approach enables the control of potential endogeneity and unobserved heterogeneity, ensuring that the effects of IPSAS on corruption are reliably assessed across different national contexts. Findings The findings demonstrate that adopting IPSAS significantly reduces corruption, as evidenced by negative coefficients in the Corruption Perceptions Index (CPI) and the Control of Corruption (CCP) indicators. These results underscore IPSAS’s effectiveness in enhancing financial transparency and accountability within public sector management, affirming its role as a crucial tool in combating corruption internationally. Research limitations/implications The study is limited by data scarcity in some developing countries and the variability in IPSAS implementation across regions, which complicates the assessment of adoption status. Nevertheless, it offers valuable insights into the global effectiveness of IPSAS in reducing corruption. Practical implications Governments, especially those in high-corruption regions, are encouraged to prioritise IPSAS adoption to improve financial transparency and accountability. International organisations and financial institutions must support this process through technical and financial assistance for effective implementation and capacity building. Social implications IPSAS adoption promotes better governance and public trust by offering transparent financial reporting. When policymakers utilise IPSAS-generated data, they make informed decisions, reduce corruption, promote equitable resource allocation, and enhance public services, thereby improving social welfare and stability. Originality/value This study offers a comprehensive global analysis of IPSAS’s impact on corruption across developed and developing countries. Using a robust S-GMM approach and a long-term dataset, it delivers original empirical evidence on how standardised public financial reporting can significantly contribute to global anti-corruption efforts.