Ajay Adhikari and Rasoul H. Tondkar*　The American University, Washington, D.C. and Virginia Commonwealth University, Richmond, Virginia, respectively　　Journal of International Financial Management and Accounting 4:2 1992　　 Abstract 　The globalization of capital markets has resulted in a great deal of attention being focused on problems created by accounting diversity in different countries.A number of studies have documented variations in accounting disclosure and re- 　porting practices and standards in different countries. Diverse environmental factors have been cited in the literature to explain differences in disclosure levels between countries. This paper examines the relationship between environ- mental factours and the accounting disclosure requirements of stock exchanges indifferent countries. 　A cross-national disclosure model is developed to investigate the relationship of selected environmental factors and sotck exchange disclosure requirements of 35 stock exchanges in different countries. Five environmental factors are used to explain the variation observed in disclosure requirements of the different stock exchanges. The five factors examined are: degree of economic development, type of economy, size of the equity market, activity on the equity market, and dispersion of stock ownership in the equity market. The overall results obtainedfrom the cross-sectional regression indicate that the level of disclosure requi-rements of stock exchanges is related to the selected environmental factors in- different countries. Of the five factors examined, however, only size of the equity market is found to be a significant explanatory variable. 　*We are grateful to Helmut Becker, Frederick Choi, Hans Dykxhoorn, Kathleen Sinning, and two anonymous reviewers for helpful comments.