Obstacles to implementing International Public Sector Accounting Standards in Libyan government institutions

Abstract

This study aimed to identify the most significant obstacles hindering the implementation of International Public Sector Accounting Standards (IPSAS) in Libyan government institutions. The study employed a descriptive-analytical approach, utilizing a questionnaire as the primary data collection tool. The study population comprised members of the Audit Bureau, financial controllers, and accountants working in the Audit Bureau and the Financial Control Office in Ajdabiya. Data analysis was conducted using the Statistical Package for the Social Sciences (SPSS). The study identified several key obstacles, most notably legislative and regulatory barriers. These included a lack of conviction among officials regarding the importance of IPSAS, outdated relevant laws, and the varying nature of the Libyan legal environment, in addition to limited external relations and weak political will. The study also identified infrastructure-related obstacles, including weak communication networks, insufficient training programs, inflexible organizational structures, low levels of accountant qualifications and experience, weak internal control systems, limited financial resources, and the high costs associated with transitioning to IPSAS. In addition, the study identified obstacles related to the financial and accounting system, including outdated accounting software, the absence of a regulatory body for the profession, the ambiguity of some accounting concepts, the difficulty of amending financial records, differing definitions of expenses and revenues, the inflexibility of the financial system in adopting international standards, and a shortage of specialized personnel capable of implementing them.

Based on these findings, the study recommended updating laws and regulations to ensure their alignment with international standards, enhancing awareness and training for officials and accountants, and improving the technological infrastructure by updating accounting software and adopting advanced electronic systems. It also emphasized the importance of strengthening internal and external oversight, providing the necessary financial and technical support for the transition to international standards, and establishing an independent accounting body to oversee the implementation process. Furthermore, the study stressed the importance of improving the efficiency of accountants through continuous training and development programs and enhancing cooperation with international institutions to benefit from successful experiences. It also called for developing mechanisms for amending accounting records and incentivizing investment by updating legislation to encourage compliance with international standards, thereby contributing to improving the business environment in Libya.