Unintended consequences in implementing public sector accounting reforms in emerging economies: evidence from Egypt, Nepal and Sri Lanka
| Author | Dayananda Ambalangodage,Chamara Kuruppu,Hassan Ouda,Pawan Adhikari,Giuseppe Grossi |
| DOI | 10.1177/0020852319864156 |
| Date | 01 December 2021 |
| Published date | 01 December 2021 |
| Subject Matter | Articles |
Article
International
Review of
Administrative
Sciences
Unintended
consequences in
implementing public
sector accounting
reforms in emerging
economies: evidence
from Egypt, Nepal
and Sri Lanka
Pawan Adhikari
University of Essex, UK
Chamara Kuruppu
University of South-Eastern Norway, Norway
Hassan Ouda
German University in Cairo, Egypt
Giuseppe Grossi
Nord University, Norway, Kozminski University, Poland, and
Kristianstad University, Sweden
Dayananda Ambalangodage
University of Sri Jayewardenepura, Sri Lanka
Abstract
This study investigates the implementation of public sector accounting reforms in Egypt,
Nepal and Sri Lanka. Data for the article are derived through document analysis and
Corresponding author:
Pawan Adhikari, Essex Business School, University of Essex, UK
Email: padhik@essex.ac.uk
International Review of Administrative
Sciences
!The Author(s) 2019
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DOI: 10.1177/0020852319864156
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2021, Vol. 87(4) 870–887
semi-structured interviews with public administrators, government accountants and
members of professional accountancy bodies. The article brings out the factors that
have either individually or collectively stifled the diffusion trajector y of public sector
accounting reforms in Egypt, Nepal and Sri Lanka at the implementation phase, includ-
ing the bundling process, pro-innovation biases, informal and interpersonal networks, a
boundary-spanning process, organisational communication, power disparity, and dom-
inance. As a result, public sector accounting reforms have resulted in resistance, inter-
nal conflicts and unintended consequences, including the fabrication of results, in all
three countries without any evidence of yielding better results for public sector gov-
ernance and accountability.
Points for practitioners
Public sector accounting practitioners should realise the importance of considering the
specific contexts of emerging economies, including the power structures, communica-
tion channels, informal networks and communication flows, prior to the diffusion of
reforms. When such contextual elements are de-emphasised, reforms would tend to
encounter delay and resistance, ongoing reforms in Egypt, Nepal and Sri Lanka serving
as examples. Also, instead of delegating power to professional accountants and expert
groups, they can be employed as boundary spanners to facilitate communication with
government accountants about the technical complexities of public sector accounting
reforms. This may help establish an efficient communication network and strengthen
interpersonal and informal networks, enabling reforms to pass through the diffusion
trajectory without being stifled at the implementation phase.
Keywords
accrual accounting, diffusion, emerging economies, International Public Sector
Accounting Standards, public sector
Introduction
This article aims at investigating the implementation of public sector accounting
reforms in emerging economies, drawing evidence from Egypt, Nepal and Sri
Lanka. That these reforms have evolved as a dominant development discourse
in the structural adjustment programmes and loan conditionality of international
organisations to emerging economies is covered in prior work (Van Helden and
Uddin, 2016). The existing accounting practices in emerging economies, built on
the cash principle, have long been claimed by the World Bank to be inadequate
(Rahaman and Lawrence, 2001) in terms of improving governance and stimulating
economic growth (Hopper et al., 2017). Accrual accounting, labelled as a ‘best
accounting practice’ and an ‘accounting innovation’ (Adhikari et al., 2015), has
been diffused to these countries on account of its adoption by Western countries
871
Adhikari et al.
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