University of Dar es Salaam Business School

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Browsing University of Dar es Salaam Business School by Author "Adhikari, Pawan"

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    Investigation of the institutional and decision-usefulness factors in the implementation of accrual accounting reforms in the public sector of Tanzania
    (Journal of Accounting in Emerging Economies, 2014-03-12) Mbelwa, Latifa; Adhikari, Pawan; Shahadat, Khandakar
    Purpose The purpose of this paper is to investigate the factors that have resulted in the effective implementation of accrual accounting reforms in the Central Government of Tanzania. Design/methodology/approach The paper relies on the ideas of institutional theory and some aspects of decision-usefulness so as to delineate the external pressures enforcing the Government of Tanzania to embrace accrual accounting and the factors complicating its implementation at organisational level (within government entities). The authors draw on quantitative techniques and the explanatory and cross-sectional survey research strategies and methods for data analysis. Findings Our findings suggest that the coercive pressures from donors and auditors along with the normative pressures surfaced by the training of employees generate a significant impact on designing the effective administrative model of accrual accounting. In a lesser extent, pressures from the National Board of Accountants and Auditors and cultural factors are positively correlated to the implementation of accrual accounting in the Tanzanian context. Of the factors the authors examined, the management changes are proved to be least effective. Unawareness of the key stakeholders has caused weak political and regulatory commitments. Accrual accounting implementation is further exacerbated by inadequate technical and personnel competence. Ultimately, the implementation of the accrual accounting has increased significant managerial accountability though a major segment of such behaviour is unexplained by the factors the authors employed in the study. Practical implications The effective implementation of accrual accounting relies on improvements in cultural and human-related issues. What is important to understand is that accrual accounting is more of a management reform incorporating changes in broader aspects of institutional and accountability mechanisms, rather than just an adoption of particular accounting technologies. Without such broader changes, accrual accounting reforms can be detrimental providing the technocrats and government officials with a space for manipulating financial information, Tanzania serving as an example. Originality/value The study highlights the case of an emerging economy in which accrual accounting is actually in effect and has impacted on managerial accountability, but is struggling to engender intended results and outcomes at organisational level.