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Kesto, Dakito Alemu
- Challenges and Benefits of IFRS Implementation Projects: The Case of First-PhaseAdopters (Public Interest Entities in AddisAbaba)
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Authors
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1 Head, Accounting & Finance Program Unit, School of Commerce, CoBE, Addis Ababa University, ET
2 Addis Ababa University, ET
1 Head, Accounting & Finance Program Unit, School of Commerce, CoBE, Addis Ababa University, ET
2 Addis Ababa University, ET
Source
International Journal of Business Ethics in Developing Economies, Vol 10, No 2 (2021), Pagination: 25-34Abstract
The objective of this study was to examine the challenges and benefits of the IFRS implementation project in Ethiopia. The study raised two main research questions: what are the practical challenges faced while implementing IFRS in Ethiopia for the selected companies and what are the benefits gained by adopting this international standard. To answer these research questions, the study used descriptive research design and adopted the quantitative research approach. Based on the analysis, the results show that the IFRS implementation project in Ethiopia would result in a number of important benefits, like better quality of report, better risk management practices for the management, increased cross-border investment, reliability and accessibility of reports, improved financial statement disclosure, mobility of professionals from one country to another, and easy and simple intra-country organisation for a wide range of stakeholders, investors, companies, and management as well. On the other hand, the main challenges in the process of implementing IFRS include significant cost of adoption of IFRS, need for training, lack of readiness to implement within the time frame set by the board, lack of adequate implementation guidance, and lack of enforcement capacity. The study suggested that a rigorous IFRS capacity-building programme should be embarked by the government, all regulatory bodies, firms, and training institutions to provide the needed manpower for IFRS implementation.Keywords
IFRS Adoption, IFRS Implementation, Project, Challenges, Regulatory Body
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