Conceptual Understanding In Managing Change Towards Accrual
Based Accounting In Malaysian Public Sector
Vol. 2, No. 1, 2012, pp. 53 – 66


: Fauziah Mahat, Noor Azman Ali


A change management from cash to accrual method of accounting is important because it enables more efficient and effective fiscal management where accrual accounting will facilitate the costing of resources, which is essential to the effectiveness of Outcome Based Budgeting in promoting the sustainability of fiscal policies (Becker, Defond, Jiambalvo and Subramanyam 1998). In cash basis accounting systems, expenses are not recorded on the financial statements until they have been paid. Due to unpaid bills cannot be shown on the books, it is extremely difficult to accumulate cash reserves to pay them because the current tax laws. Malaysian government has announced the need to change to International Public Sector Accounting Standards (IPSAS) accrual-based accounting by 2015. Thus, it is important for Accountants General Department Malaysia (AG) to change management from cash method to accrual method due to the information contained in reports prepared on an accrual basis is useful both for accountability and decision-making. Therefore, the objective of this study is to review the concepts, theories and previous research on the change management towards accrual based accounting from customers and employees perspectives.


Keywords: Change Management, Accrual Accounting Basis, Cash Accounting Basis.