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Perception of Accountants towards the Adoption of International Financial Reporting Standards for Small Medium Enterprises in Somalia

Year: 2025

Type: article

Abstract: This study investigates the perception accountants toward the adoption of International Financial Reporting Standards (IFRS) for Small Medium-Sized Enterprises (SMEs) in Somalia.Given Somalia's underdeveloped accounting environment and lack of a national regulatory framework, the research explores how perceived benefits, challenges, knowledge & awareness, and cost constraints influence attitudes toward adoption.A quantitative research design was employed, using Cochran's formula to determine a sample size of 384 accountants from SMEs and related institutions.Primary data were collected through structured Likertscale questionnaires and analyzed using descriptive statistics, correlation, and multiple regression analysis with SPSS.The findings revealed that there are statistically significant positive associations between perception of adoption and all independent variables, with the strongest relationship observed between perceptions and cost/resource constraints (r=.958, p<0.01).Regression analysis further confirmed that perceived challenges (β = 0.391), perceived benefits (β = 0.381), knowledge and awareness (β = 0.336), and cost/resource constraints (β = 0.331) significantly predict perceptions, explaining 97.8% of the variance (Adjusted R² = 0.977, F = 4147.919,p < 0.001).The study concludes that Somali accountants overwhelmingly support IFRS for SMEs adoption despite acknowledging systemic barriers.Recommendations include capacity-building through professional training, establishment of a national accounting regulatory framework, provision of financial and technical support, stakeholder engagement, and phased implementation.These measures are essential to bridge knowledge and resource gaps, thereby fostering transparency, comparability, and sustainable growth within Somalia's SME sector.

Source: International Journal of Academic Research in Business and Social Sciences

DOI: 10.6007/ijarbss/v15-i8/26393

Authors: Mohamed Ali Abdinur, Resat Karcioglu

Institution: Atatürk University

Language: English

Topic: Accounting Theory and Financial Reporting

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: diamond

OpenAlex ID: W4413842689