Challenges in the adoption of MPSAS/IPSASS/ACCRUAL accounting in Malaysia and other countries
Journal Title: Religación. Revista de Ciencias Sociales y Humanidades - Year 2019, Vol 4, Issue 17
Abstract
The Malaysian Public Sector Accounting Standards (MPSAS) is adapted from the International Public Sector Accounting Standards (IPSASs) issued by the International Public Sector Accounting Standards Board (IPSASB). In Malaysia, for the first time in 2015, the Federal Government’s financial statements were expected to be prepared using the accrual basis, in accordance with the MPSAS. However, for some reasons, this failed to happen. The objectives of this study are to investigate the challenges in the adoption of MPSAS in Malaysia and to identify the actual initiatives taken to overcome the challenges. This is a concept paper, which starts with the outline of the background of MPSAS. This paper explains the reasons for the adoption of MPSAS/IPSASs/accrual accounting. The most popular reason is that, it increases transparency and accountability. This paper then elaborates on the challenges faced by several countries in the adoption of MPSAS/IPSASs/accrual accounting. These challenges can be divided into several categories, for instance, technical challenges and political challenges. Lastly, this paper describes the proposed initiatives to be taken and the actual initiatives taken to overcome the challenges. Training of public servants is crucial to ensure the successful adoption of MPSAS/IPSASs/accrual accounting. The findings of this paper can be used to assist Malaysian local authorities in implementing accrual accounting and to achieve the desired outcomes from the adoption.
Authors and Affiliations
Siti Hawa Shuid, Siti Aisyah Basri, Ainol Sarina Ahmad Zazili
Keywords
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