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While direct IPSAS and IFRS adoption remains low, most OECD country governments have adopted accrual accounting

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Feb 24, 2017

On February 24, 2017, a new study was released by the International Federation of Accountants (IFAC) and the Organisation for Economic Co-operation and Development (OECD), where they found that nearly three-quarters of OECD countries have adopted accrual accounting for their year-end financial reports. In 2003, only a quarter of the governments used accrual accounting.

The study was conducted from November 2015 to June 2016 among all of the (then) 34 OECD countries. Of those 34 countries, 25 countries (73%) base their annual financial reports on accrual accounting, and another three countries (9%) are currently transitioning to accrual accounting. Only six countries still use cash accounting.

The study also points out that while the direct adoption of international accounting standards, such as International Public Sector Accounting Standards (IPSAS) or International Financial Reporting Standards (IFRS), by national governments remains very low, almost 40% of the standard-setters use IPSAS (28%) or IFRS (9%) as primary or explicit references for developing their national standards.

The study 130 page study offers a short executive summary, a 15 page analysis of practices across all countries, and afterwards a detailed analysis of each country's accounting practice.

Review the study Accrual Practices and Reform Experiences in OECD Countries on the IFAC's website.

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