Finally, the findings of this study have policy implications for IASB and African accounting regulators. Allowing companies to choose between accounting policies may encourage earnings management and this may mislead investors. This means that in the context of Tanzania, regulations need to clearly specify the accounting standards that firms have to apply. However, the findings of this study should be interpreted in the context of the sample size used. A sample size of 60 firm years is too small to provide conclusive evidence in Africa. Further research is required in other African countries with more listed companies on their stock exchanges; for example, countries such as Kenya, South Africa and Zimbabwe. It may also be interesting to carry out a cross-country study to determine whether accounting policy choice differs by country in Africa. Further to this, because the study uses panel data, with each company included five times, the results are affected by the economic changes or specific events in a specific year. To the extent that the economic changes or events are not controlled for in the model – this is a limitation. Future researchers could use cross-sectional data to avoid the economic changes between years, test foreign political costs, managers’ discretion, audit committee, and industry. Moreover, they should try to use a natural logarithm of total sales as a measure instead of a natural logarithm of total assets. They should also investigate the relevance of each option when choosing accounting policies.