Authors: Olympia Gkouma, Ioannis Filos
Title: The perspective of public servants on the impact of International Public Sector Accounting Standards (IPSAS) on public management and auditing: Evidence from Greece
Abstract
The adoption of International Public Sector Accounting Standards (IPSAS) is gaining momentum across the world. Greece initiated a general financial management reform program which includes the transformation of financial accounting. The public sector in Greece adopted IPSAS-based standards (P.D.54/2018) in June 2018. The transition from modified cash accounting to accruals accounting brought the country one step closer to IPSAS. The objective of this study is to assess the impact of IPSAS on financial reporting, auditing and public management in Greece and reveal the perspective of public servants in respect to the anticipated benefits and challenges to be encountered in the transition process.
The results of this study indicate that Greece is at a premature stage regarding IPSAS. The awareness and understanding of IPSAS is very low among public servants while the majority have never attended any educational programme on the subject. The perception that the quality of public sector accounting based on the previous accounting standards (modified cash basis) is not adequate gains ground and the majority of 84% argue that a major reform of the public sector accounting system is critical. Public servants expect that IPSAS would significantly contribute to the quality of financial reporting, enhance the transparency and accountability in public administration, contribute to the effectiveness of audit work, reduce corruption, bureaucracy, mismanagement of public resources and waste of money and improve decision making. Furthermore, the comparability associated with IPSAS could result in attracting investments and highlight good corporate government practices.
Nonetheless, it appears that the implementation of IPSAS has to overcome several challenges in order to be successful and utilise these benefits. The lack of knowledge and skills in public sector is perceived to be a key issue by 66% of public servants. The 95% argue that public servants are in great need for training in order to cope with the challenging project of implementing IPSAS while 80% point the need to recruit knowledgeable professionals from private sector and 63% is in favour of using external consultants to facilitate the transition process. The 92% concur that the modernization of IT systems and training of users is critical for the successful implementation. Public servants consider that IPSAS will complicate their day-to-day work at some extent in the short term. However, the 77% believe that once the short-term difficulties are encountered, IPSAS will probably facilitate their work in the long-term. The resistance to change is another important element. About 24% of public servants are perceived to be relatively ready to accept and embrace the changes arising from IPSAS, approximately 36% appear rather cautious about change while 40% do not express an opinion on the acceptability of IPSAS by public servants. In addition, the 59% concur that the mentality and culture of public servants would impede the accounting reform of public sector. In respect to the overall perception of public servants on the feasibility of public sector to assert full compliance with IPSAS, the 59% consider the target to be achievable, the 30% do not express an opinion while the 13% argue that full compliance is unattainable.
Research regarding the implementation of IPSAS in Greece appears to be limited. This study provides useful insights on the transition to IPSAS for all parties engaged in public administration reform as well as to countries that are in process or planning to adopt IPSAS.
