Identifying Factors Influencing Compliance of Malaysian Public Sector Accounting Standard (MPSAS): Evidence from Federal Statutory Bodies (FSBS)

Ibrahim Bin Abu Sin and Shukriah Binti Sa’ad
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Ibrahim Bin Abu Sin: Academy of Sciences, Malaysia
Shukriah Binti Sa’ad: Faculty of Accountancy, University Technology MARA, Puncak Alam, Selangor, Malaysia

International Journal of Research and Innovation in Social Science, 2025, vol. 9, issue 9, 2186-2199

Abstract: MPSAS compliance is a topic of intense discussion between federal statutory bodies and the federal government. Despite the efforts of the Malaysian Government to encourage Federal Statutory Bodies (FSBs) to adopt MPSAS, it was noted that some FSBs had either not yet adopted the standards or had been delayed in their adoption. This study examines the compliance factor in Malaysian FSBs, specifically MPSAS compliance. Three factors, namely accounting education, technology and infrastructure, and cost-benefit are analysed to understand their impact on MPSAS compliance. A questionnaire survey was used as the research instrument, with 69 individuals representing various FSBs. Correlation analyses and logistic regression were conducted to establish the relationships between the independent variables and compliance with MPSAS. The findings only confirm that cost-benefit plays a significant role in MPSAS compliance among Malaysian FSBs. However, two variables had no statistically significant role in MPSAS compliance. This study could make valuable contributions to the research arena, assist policymakers in refining accounting standards and regulatory oversight, and facilitate improvements in educational approaches and resources to better prepare accounting practitioners for compliance with MPSAS and other relevant standards. The study provides valuable information to FSBs, the Accountant General Department, as well as the National Audit Department in guiding them in forcing compulsory standardization and compliance with the MPSAS. This is important to ensure the reliable and transparent disclosure of the government's financial reporting. Future research suggests assessing how implementing Malaysian public sector accounting standards (MPSAS) affects financial reporting within FSBs.

Date: 2025
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