The Usefulness of Accrual Information in Non‐mandatory Environments: The Case of Japanese Local Government
Published online on June 16, 2016
Abstract
This study investigates how accrual accounting is used in a system in which it co‐exists with cash accounting. It uses a survey methodology to explore the factors that influence the extent to which accrual information is useful for decision making, when used in a dual system. The results show that although accrual information was used less for budgeting, evaluation, asset management or debt management, officials found accrual information useful for performance management. Moreover, neither experience nor leadership significantly contributed to decision‐making effectiveness. The study also found that the central government was the most influential promoter of accrual accounting in Japan. Of particular interest is the link between performance measurement and accrual information.