The Moderating Effect of Professional Boards on the Influence of External Audit Services on IPSAS Implementation in Tanzania: The Accountants ' Perspectives

Abstract

The study assessed accountants ' perspectives on the moderating effect of professional boards on the influence of external audit services on International Public Sector Accounting Standards (IPSAS) implementation. IPSAS are standards used by Public Sector Entities (PSE) when preparing their financial statements. The objective of IPSAS is to improve the accountability of PSE. The objective of professional boards is to serve the public interest by ensuring competent practice within an occupation.  The boards  typically have substantial power, which enables them to impact knowledge to individual practitioners, members of the public, and the profession as a whole. Tanzania PSE started using IPSAS in 2004 after it was adopted by the National Board of Accountants and Auditors (NBAA), the accountancy professional board in Tanzania. The study used primary data collected from 379 PSE respondents, comprising 306 financial accountants, 36 external auditors, and 37 internal auditors. Questionnaires were used to collect the data. The data analysis techniques employed were means, percentages, standard deviation, and structural equation modeling. Institutional Theory was used to assess the influence of professional boards on the financial reporting practices of Public Sector Entities (PSE). The findings revealed that professional boards have a significant positive moderating effect on the influence of external audit services regarding IPSAS implementation. However, the study ' s use of a cross-sectional design may have prevented the researcher from making certain pertinent observations. This study is unique in its approach of analyzing the impact of professional boards on PSE financial statements.