ABSTRACT
This article investigates the environmental factors associated with countries’ decision to adopt International Public Sector Accounting Standards (IPSAS). Based on a sample of 110 countries, the results reveal a positive influence of external public funding (coercive isomorphic pressure), the degree of external openness (mimetic isomorphic pressure), and public sector organizations’ importance on IPSAS adoption. They show a negative effect of the availability of local GAAP on this decision, whereas education level (normative isomorphic pressure) is a nonsignificant factor.
This research contributes to the international accounting literature in the public sector. The results are relevant to standard-setters, regulators, researchers, international financial organizations, and non-adopting countries.