Identification and ranking of obstacles to the establishment of accrual accounting system in Kashan University of Medical Sciences

Dissertation for Master's degree

Faculty of Management

Abstract

Since the application of accrual accounting has an important contribution in improving the level of accountability and achieving the goals of financial reporting, therefore, in this research, the obstacles to the establishment of this accounting system and providing the necessary solutions to overcome the obstacles have been addressed. The research community is Isfahan University of Medical Sciences. According to the activity environment of the researcher, Kashan University of Medical Sciences has been selected as a research sample. A structured questionnaire with Likert scoring was used to collect data. In this research, one-sample t-test and ANOVA were used to analyze the findings. The average scores obtained in managerial dimensions are 3.1, process 3.3, human resources 2.8, technical 3.2, rules and regulations 3, and management accounting 2.9. The present study showed that among the most important effective obstacles in the establishment of the accrual accounting system, we can mention the factors related to human resources, laws and regulations, and factors related to management accounting. Of course, in the meantime, management, process and technical indicators are in a relatively good condition.

Keywords: accrual accounting system, Kashan University of Medical Sciences and Health Services, establishment barriers

Introduction:

In this chapter, the statement of the problem, importance and necessity of research, research objectives, research questions, research hypotheses, aspects of research, scope of research and theoretical and practical definitions and research variables have been discussed.

1-1: Statement of the problem

The basis of progress in today's world is based on increasing access to information and technology. Correctness of thinking, insight and necessary information about the existing situation and the ability to create, transform and make necessary changes are among the factors that help the management in reaching the high goals of the organization. (Abulhallaj, 1389, 11) In today's world, even small economic units cannot be managed without accurate and timely information. (Working group for reforming the financial system of the country's municipalities, 2018, 19)

Previously, obtaining correct and timely information in various companies was very expensive and difficult until management and accounting sciences were able to approach their organizational goals by adopting mechanized systems. (Khajovi and Etamadi, 1389, 2) Examples of this are the financial reforms in the public sector, i.e. moving towards accrual accounting; Accrual accounting is supported from the point of view of improving accountability, transparency and participation of citizens as symbols of modern governance and enhancing citizens' trust in the government. (Rahmani and Rezaei, 2013, 263)

The acceptance of accrual accounting system has been growing all over the world, but the way of its acceptance has been different in different countries. (Talibnia, 1390, 75) Countries are on the verge of structural reforms in order to accept this system, but how to reform and the interaction of factors affecting this process is a serious challenge. The existence of a theoretical framework to explain the reform process and describe the atmosphere around it is undeniable. (Vakili Fard and Nazari, 1391, 113)

It seems that the introduction of accrual accounting is associated with more problems, especially in developing countries. The implementation of the accrual accounting system has made it necessary to modify the management attitude and management performance evaluation system. Management as the main manager of a small unit or a large unit like the government plays a significant role in the implementation of accrual accounting. (Iranshahi and Kurdestani, 1388, 14)

Before using this system, it should be noted whether this information system can be used properly or not? Most organizations design and implement based on organizational needs, the situation where the system is located, and user feedback. In fact, it should be checked that the system has successfully completed the implementation phase.(Khajovi and Etemadi, 1389, 2)

In the health sector, on the one hand, due to the fact that in the current conditions, the increase in health care costs and the decrease in the economic growth rate of hospitals, as one of the main consumers of the health system, have created concerns for the executive directors and policy makers of the health sector, and on the other hand, due to the limited resources of the health sector, (Sadeghi, 1388, 147) we need to have information that It should be prepared and exposed to the use of decision makers. (Bakhtiari, 1387, 56)

Therefore, based on the above and also due to the fact that the Ministry of Health, Treatment and Medical Education, in line with Clause A of Article 20 of the Law of the Fifth Development Program and Article 16 of the Law of State Services Management, in order to determine the cost price of services and activities and to receive its price, is trying to change its accounting method and the universities of medical sciences from cash accounting to full accrual accounting. In this research, considering the importance of information and information systems, the researcher intends to examine the obstacles to the establishment of accounting information systems in Kashan University of Medical Sciences and provide the necessary solutions to remove the existing obstacles.

1-2: The importance and necessity of conducting the research

The process of changing from cash accounting to accrual accounting began in the early 1990s for British central government offices, and accrual accounting was established in about ten years. Similar changes occurred in Ireland at the same time as Britain. But factors affecting the establishment of the accrual basis such as pragmatism, lack of public desire, ideological and political pressures and cultural differences prevented the implementation of the system based on accrual basis instead of cash. Canada also used accrual accounting in the public sector in 2002. (Vakili Fard and Nazari, 1391, 113) The United States started a gradual movement towards accrual accounting long ago, and only until 2002, some of its states used accrual accounting. (Rahmani and Rezaei, 1390, 264)

In general, during the last decade, financial system reforms have started by replacing or transferring the old cash accounting system to a quasi-commercial accrual accounting. Countries such as New Zealand, England and Australia are considered to be leading countries in terms of the application of the accrual basis in the accounting system of the public sector. A number of other countries, such as Sweden, Greece, Finland, Belgium and the United States, have turned to using accrual accounting in the public sector. International institutions and public sector accounting standards compilation boards and many accounting experts of this sector have also emphasized the use of accrual basis in accounting of governmental and non-profit activities of the public sector. (Babajani, 1385, 8) Therefore, the recent increasing attention to the implementation of accrual accounting has led to the creation of extensive research fields regarding the obstacles affecting the successful implementation of this system. (Rahmani and Rezaei, 2013, 264)

On the other hand, the software movement and the rapid change and transformation of today's era in the field of management sciences, as well as its effects on accounting and reporting to capital owners, have made the people responsible in this matter to think of finding solutions to move quickly towards growth and development. (Khajovi and Etamadi, 1389, 2) These reforms in recent years have had significant effects on the scope, nature, provision and management of public services. (Mohammadi, 1391, 73)

1-3: Differentiating aspects of the research

Although researchers have discussed many possible consequences of using accrual accounting and its role in organizational changes and developments, it seems that there are still many other aspects that require more research; Especially in service sectors such as the health sector. Therefore, considering the establishment of the modern financial system and the subsequent establishment of the accrual accounting system at the level of the Ministry of Health and Medical Education and Medical Sciences Universities, this research examines the problems related to the full establishment of this accounting system. Using the accrual accounting reporting system. Main objective: Identifying and ranking effective obstacles in establishing the accrual accounting system in Kashan University of Medical Sciences. Special objectives: Identifying managerial obstacles in establishing the accrual accounting system in Kashan University of Medical Sciences. Identifying process obstacles in establishing the accrual accounting system in Kashan University of Medical Sciences.

Identifying obstacles related to human resources in the establishment of accrual accounting system in Kashan University of Medical Sciences. 

Identification of technical obstacles in the establishment of accrual accounting system in Kashan University of Medical Sciences.

Identification of obstacles related to laws and regulations in the establishment of accrual accounting system in Kashan University of Medical Sciences.