Posted: June 6th, 2019
TO FIND OUT HOW IAS/IFRS CAN BE USED EFFECTIVELY TO FIGHT CORRUPTION IN AFRICA
TO FIND OUT HOW IAS/IFRS CAN BE USED EFFECTIVELY TO FIGHT CORRUPTION IN AFRICA
INTRODUCTION
Transparency international (2017), described corruption as a major problem affecting countries all over the world but the
effects as stated by Nduku & Tenamwenye (2014, P.25) “are more evident in Africa than any other continent”. The entire
African system has been ravaged by corruption making it the most corrupt worldwide (Lawal, 2007). In the words of
Chantal, (TI 2012, p.1) “Corruption perpetuates poverty. It skews decisions and diverts scarce funds, denying poor people
access to basic social services and resources to improve their livelihood”. To help end this situation this paper proposes to
investigate viability of using IAS/IFRS.
STATEMENT OF THE PROBLEM
Different bodies over time have been trying to fight corruption in Africa, the notable being private groups who act as
whistle blowers e.g civil societies, journalist, activists, business group etc. Some government’s have established anti-graft
bodies, security units dealing with criminal investigations and even judicial system that solely handle corruption cases but
overally, Africa as classified by Transparency International (2017) was the worst performing with the best being Europe.
The purpose of my research is to try and explore how IAS/IFRS can be used as a tool to help in the fight.
TYPE OF RESEARCH
I aspire to undertake qualitative and quantitative research to gain deeper understanding on the feasibility of using IAS/IFRS
to combat corruption.
SIGNIFICANCE
The usefulness of my research is to try to develop and recommend and effective strategy to tackle corruption with the aim
of eliminating it and enable development which improves livelihood.
RESEARCH QUESTIONS
1. What is the extend and level of corruption within and without governments in Africa
2. What are the current strategies and challenges of tackling corruption worldwide
3. What is the feasibility of using IAS/IFRS as an aid in combating corruption.
4. Are there any changes needed to ensure effective adoption and use of IAS/IFRS
LITERATURE REVIEWS.
Quite a number of studies have examined various aspects of IAS/IFRS adoption though mainly in countries outside of
Africa. Countries with least corruption e.g Europe adopted IAS and later IFRS as their reporting standards from year 2002
(Kythreothis,2015). In China, Yan Sun (1999, p.6) article indicates that corruption has been reduced as a result of using
accounting practices, and accounting reviews have uncovered violations and served to prevent future ones. Studies by
Shleifer and Vishny (1993, p.604) suggests that “the first step to reduce corruption should be to create an accounting
system that prevents theft from government”. The view supported by, Everett, Neu & Rahman (2007, p.515) who asserted
that corruption is a problem that can be fought with the help of accounting. Lastly, Malagueno et.al (2010) proposed that
adequate accounting standards force organizations to be accurate and straightforward in their reporting, which enables
transparent use of organizations assets thus hindering corrupt practices and its concealment. Some researchers have also
highlighted some limitations with IFRS (Kythreothis,2015), found that adopting IAS/IFRS might not be enough depending on
the country’s level of corruption. Voice added by Panagiotis (2017) in his study, “Analysis of global IFRS adoption” whose
studies showed varied results and as he indicated was marred by software and time constraints and so generalizations with
his findings can’t be made and it also never touched on an African country.
METHODOLOGY
I intend to carry out my research by reviewing appropriate and available literature on IFRS adoption from least corrupt
countries. Develop questionnaires targeting 200 respondence and carry out structured interviews with civil societies,
government officials and accounting institutions of namely Kenya, South Africa and Nigeria.
REFERENCES:
Alexios Kythreotis 2015, The interrelation among faithful representation (reliability),corruption and IFRS adoption: An
empirical investigation, International Journal of Business and Economic Sciences Applied Research (IJBESAR),Vol.8,Issue
1,pp. 25-49 https://www.econstor.eu/bitsream/10419
Andrei Shleifer and Robert W. Vishny 1993, “Corruption”, The quarterly Journal of economics, Vol.108 No.3, pg. 599-617
https://projects.iq.havard.edu/gov2126
Chantal Uwimama 2012, Transparency International: Poverty and Corruption in Africa; Community voices break the cycle
pp,1 https://www.transparency.org/files/content/activity/2012
Elizabeth Nduku & John Tenamwenye 2014, Corruption In Africa: A Threat to Justice and Sustainable Peace
https://www.globethics.net/documents/4289936/13403252
Gargalis Panagiotis 2017, A Qualitative Analysis of the Global IFRS Adoption Trustees Perspective Vol 6 Issue2 pp 59-70
https://www.researchgate.net/publication/318442625
Gbenga Lawal 2007,Corruption and Development: Challenges for political and Economic change journal 2 issue 1
https://www.researchgate.net/publication/267721074
Jeff Everett, Dean Neu and Abu Shiraz Rahaman 2007, Accounting and the global fight against corruption Volume 32,Issue
6, pp 513-542 https://doi.org/10.1016/j.aos.2006.07.002
Ricardo Malagueno, Chad Albrecht ,Christopher Ainge and Nate Stephens, 2010,“Accounting and corruption; a crosscountry analysis”, Journal of Money Laundering Control, Vol.13 Issue 4 pp 372-393
https://doi.org/10.1108/13685201011083885
Sun Yun 1999, Reform, State and Corruption: Is corruption less destructive in China than in Russia? “comparative politics
Vol 32 No.1, pp,1-20 https://www.jstor.org/stable/422430
Transparency International 2018, Corruption Perception Index 2017 https://www.transparency.org