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The purpose of this study is to determine the factors influencing the accounting conservatism for banks in the UAE over the period 2006-2013. Design/methodology/approach – Multiple regression analysis is used to test the relationship between accounting conservatism as a dependent variable and the independent variables intellectual capital performance, market structure, level of protection against risk, bank size, and bank profitability. The results indicate that intellectual capital performance, market structure, bank size, the level of protection against risk and bank profitability have significant impact on the accounting conservatism for banks in the UAE. These results might help the banking and accounting regulators to address the factors affecting accounting conservatism. This study adds to the literature on the determinants of accounting conservatism in banks. In particular, it tests whether the new theories of intellectual capital performance, market structure and level of protection against risk have an impact on accounting conservatism in the banking industry in the UAE.

Keywords: Accounting Conservatism, Intellectual Capital Performance, Market Structure, Level of Protection Against Risk, Bank Size, Bank Profitability, Bank Age, Banks, UAE

Received: 01.04.2017

Accepted: 25.05.2017

How to cite this paper: El-Bannany, M. (2017). Factors influencing accounting conservatism in banks: the UAE case. Journal of Governance & Regulation, 6(2), 14-21. https://doi.org/10.22495/jgr_v6_i2_p2