Abstract:
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The adoption and implementation of accrual accounting in Thailand was
influenced by the 1997 financial crisis in Asia and was endorsed by international
organizations such as the International Monetary Fund and the World Bank. As
argued by most researchers in public sector accounting that accrual accounting is
superior to cash basis of accounting, accrual accounting information and financial
statements would enhance the transparency and accountability of the government.
This research aims to explore the transition barriers of the accrual
accounting implementation and to evaluate the outcomes of the accrual accounting
implementation in the central government departments of Thailand. The sample
consists of 139 central departmental departments. The research participants are
public financial managers and accountants of Thailand’s central governmental
agencies. The improvements of financial transparency and accountability after the
adoption are concluded from the interpretation of the practitioners’ points of view
using the quantitative research method, the structural equation modelling.
Significant transition barriers that deteriorate the outcomes of the accrual
accounting implementation are the lack of incentive, the lack of supportive
management culture, the lack of accrual accounting manuals, and the difficulty of
accrual information that cannot be easily understood by users or public managers.
The findings of transition barriers that influence the implementation of accrual
accounting would help the late adopters in planning their transition processes.
The investigation of the relationships between the implementation of
accrual accounting and its outcomes. The findings show that the implementation of
accrual accounting has promoted the financial transparency and accountability of
the departments. The completeness of reporting entries, completeness of financial
information relating to assets, liabilities, and commitments, the faithfulness,
verifiability, and relevance of financial information, are financial transparency
characteristics that have been achieved. Moreover, the perceived accountability of
the departments has been enhanced by providing sufficient financial information for
the assessment of the accountability of the departments; for the achievement of
objectives, the ability to finance their activities, liabilities and commitments, the
compliance with law; the effectiveness of resources used, and the financial results
in long term.
The public sector accounting regulator should issue more accrual
accounting manuals; the guidelines for the preparation of cash flow statement and
financial forecasts; and the disclosure of budget information accompanying with the
financial statements. Accrual financial information should be tied with the incentive
system. In addition, the understanding of accrual information among users and
managers should be promoted to enhance the usefulness of accrual financial
information.
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