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Over the past 25 years significant New Public Management (NPM) reforms, particularly towards accrual accounting, have characterized the public sector in many countries. The diversity in public financial information systems created a need for harmonization, resulting in the elaboration of International Public Sector Accounting Standards (IPSAS). Despite their relevance, little is known on the adoption process of IPSAS. This study aims to examine to what extent IPSAS(-like) accrual accounting is adopted in central / local governments worldwide as well as to investigate which factors affect the differing level of their adoption. Methodologically, a specific questionnaire constructed to obtain relevant information from local experts was sent worldwide to a sample of countries. The study reveals an important move to accrual accounting, particularly to IPSAS-accrual accounting whereby there still remains a level of reluctance mainly in central governments, especially in countries where businesslike accrual accounting has been developed. Points for practitionersIPSAS have become the international reference for the development of public sector accounting systems worldwide. For this reason, IPSAS deserves the attention of accounting policy-makers, practitioners and scholars. The current study offers a comparative study of the level of adopting IPSASs worldwide as well as an explanation of the reasons behind the differing levels of adoption. The present study reveals that the transition towards IPSAS necessitates a long period of implementation whereby existing local business accounting regulations hinder jurisdictions to implement international standards. The explanatory findings are an input for reformers and legislators when designing and developing financial information reforms.

Nonprofit organizations worldwide are confronted with an increasing demand for accountability and improved financial transparency. Financial reporting by nonprofit organizations is no longer an exception; it has become a rule.The usefulness of a financial report to an organization’s stakeholders depends on its quality. The latter is safeguarded by reporting standards as well as the commitment of the organization to fully implement these standards. Although resource dependence and coercive isomorphism have been used in earlier nonprofit organization research, no empirical research has linked these theories to compliance with financial reporting standards. Using a unique setting in which a large number of (very) large Belgian nonprofit organizations are confronted with far-reaching changes in financial reporting regulations, the effect of resource dependence and coercive isomorphism on accounting and financial reporting compliance is documented.

This paper examines the cross‐sectional differences in the level of adoption and implementation of the financial accounting reform in Flemish municipalities. For the first time ever in Belgian governments a cash‐based budgetary accounting system is obligatorily being supplemented by an accrual accounting system. This study is based on an empirical analysis of municipal accounting practices and annual accounts 1995 in Flanders. The findings indicate that municipalities are coping with a lot of problems regarding transferability of business accounting and the study reveals significant factors explaining the level of compliance with the reformed accounting regulations.

The diversity in reformed governmental financial information systems created a need for harmonized international accounting standards, resulting in the elaboration of the IPSAS (International Public Sector Accounting Standards). By means of a survey on experts, this study examines the extent to which European governments adopt IPSAS accrual accounting and how the differing levels of adoption can be explained. The study reveals diversity in the adoption process of IPSAS and accrual accounting. Some governments still use cash based accounting. Only a minority apply IPSAS. The majority of local and central governments apply accrual accounting disregarding IPSAS. The trend toward accrual accounting can be explained by the need for transparency and efficiency. The fact that the IPSAS are unique and offer specific know-how is the main argument for making use of them. However, a number of jurisdictions do not adopt IPSAS because they transfer their own local business accounting rules

Based on governmental accounting experiences and on the rising criticism of accrual accounting, this paper proposes that accrual accounting in governments will only succeed in businesslike (parts of) governments in the coming years. This proposition leans on the inappropriate transfer of the accrual accounting framework from the profit sector, the underestimation of difficulties considering accrual budgeting and the lack of attention to the political dimension. This paper points out that the advocates of accrual accounting have neglected some important considerations.

Prior research has documented earnings management in for‐profit settings. Non‐profit organizations are thought to pay less attention to the bottom line and earnings management research has therefore focused on the manipulation of expenses in order to improve efficiency ratios or taxable income, not reported earnings per se. Considering an institutional setting characterized by the absence of such ratios and the presence of important subsidies, management of the actual bottom line is analyzed in light of these subsidies. The results suggest that organizations drive their results toward zero profit, which is intensified by increased governmental funding when unmanaged results are positive. The relation between downward earnings management and the presence of subsidies is particularly evident for organizations whose accumulated reserves are high. Copyright © 2012 ASAC. Published by John Wiley & Sons, Ltd.

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