Journal of
Accounting and Taxation

  • Abbreviation: J. Account. Taxation
  • Language: English
  • ISSN: 2141-6664
  • DOI: 10.5897/JAT
  • Start Year: 2009
  • Published Articles: 118

Full Length Research Paper

Factor analysis on IFRS Adoption: A survey study on lenders, users and audit firms’ perspective in West Hararghe Zone, Oromia Regional State, Ethiopia

Belesti Wodaje
  • Belesti Wodaje
  • Department of Accounting and Finance, Oda Bultum University, Asebe Teferi, Ethiopia.
  • Google Scholar
Kerima Rahmeto
  • Kerima Rahmeto
  • Department of Accounting and Finance, Oda Bultum University, Asebe Teferi, Ethiopia.
  • Google Scholar


  •  Received: 20 September 2019
  •  Published: 31 October 2019

Abstract

The adoption of International Financial Reporting Standards (IFRS) around the world is occurring rapidly to bring about accounting quality improvement through a uniform set of standards for financial reporting standards and harmonization of reporting procedures. For the same purpose, Ethiopia begins the IFRS adoption process since the year 2014. For this study, 200 questionnaires were distributed and administered to collect the required data and the collected data were analyzed using SPSS21. This study also employed descriptive statistics and dimension reduction model to make factor analysis. Based on the model output five (5), major variables were found significant with 66.22% cumulative initial eigenvalue. The main significant variables were adaptability, suitability, constraints, necessity and perceived benefits respectively.  Furthermore, upon the findings found, researchers forwarded continuous professional career development, partnership and cooperation with stakeholders and government commitment for allocation of adequate budget should be made for successful adoption of IFRS.

 

Key words: IFRS adoption, factor analysis, West Hararghe, Ethiopia.