Assessment on the adoption of International Financial Reporting Standards (IFRS) in Selected Commercial Banks in Ethiopia
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Date
2018-02
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Abstract
The study examines the adoption of IFRS by selected commercial banks in Ethiopia with the main objective of examining the factors affecting for its implementation, prospects and challenges for the adoption of IFRS. It employed both qualitative and quantitative research approach based on evidence collected through semi-structured interview and questionnaires. The questionnaires were analyzed using descriptive statistics, correlations analysis, and data from interview of the selected banks officials, National Bank of Ethiopia and the Accounting and Auditing Board of Ethiopia (AABE) for the adoption of IFRS, and document reviews were analyzed and interpreted qualitatively. The results show that IFRS adoption by commercial banks in Ethiopia results in a number of benefits to a wide range of stakeholders for commercial banks. High cost of adopting, knowledge gap, the complex nature of IFRS, lack of proper instructions and control from regulatory bodies for implementing IFRS as well as lack of leadership and commitment are identified among the most important challenges of IFRS adoption. The descriptive analysis of the factors affecting the adoption of IFRS perceived as moderate and above performance for the adoption of IFRS. It also shows the perception of the prospects of IFRS adoption for which the items perceived as moderate and above performance for its adoption. The correlation analysis shows strongly positive significant association between the factors and adoption of IFRS. Finally, the study showed some practical recommendations and implications for the adopters and non-adopters of IFRS by commercial banks in Ethiopia.
Description
A Research Project Submitted in Partial Fulfillment of the Requirements for Executive Master of Business Administration (EMBA) Degree
Keywords
commercial banks, Challenges and prospects of IFRS, IFRS adoption