Development of Accounting Regulations and Practices in Kuwait: An Analytical Review

Hesham Almujamed, Yasean Tahat, Mohamed Aboelhamd Omran, Theresa Dunne (Lead / Corresponding author)

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    Abstract

    Purpose:
    This study explores the development of accounting regulations and practices in the State of Kuwait with an emphasis on exposing key influences. Further, the study aims to provide an institutional insight into Kuwait's current accounting practices and its potential for advancement. A number of key institutional issues regarding the development of accounting are addressed including economic and political influences, the legal system classification, and cultural settings. In addition, issues affecting decision to adopt International Financial Reporting Standards (IAS/IFRS) and the role of the accounting profession in Kuwait are investigated.

    Design/Methodology/Approach:
    We adopt an institutional approach in order to facilitate an understanding of the role institutional factors have played on accounting practices in Kuwait. Our aim is to understand current practice and to attempt to influence future practice by making policy recommendations and further research suggestions.

    Findings:
    It is clear that economic, political, and legal factors are directly linked to specific features of the accounting system in Kuwait; specifically, the Kuwaiti parliament is a key player in the formation of all economic and political policies issued regarding business practices in general, and accounting ones in particular. In addition, the accounting profession could have a key role to play in shaping systems going forward. However, the professions need to assert themselves and make sure that their voices are not lost in a sea of competing concerns regarding regulatory reform.

    Research Limitations/Implications:
    This study should be of interest to academicians, practitioners and regulators of other countries, especially developing countries, who seek to develop their accounting disclosures and practices.

    Originality/Value:
    This analytical review brings together a diverse body of knowledge and attempts to understand the accounting environment in Kuwait as a coherent hole. Such a holistic approach should facilitate a clear understanding of current practices and serve to guide future accounting regulatory reform.
    Original languageEnglish
    Pages (from-to)14-28
    JournalJournal of Corporate Accounting and Finance
    Volume28
    Issue number6
    Early online date16 Aug 2017
    Publication statusPublished - 16 Aug 2017

    Keywords

    • Accounting practices
    • corporate governance
    • accounting regulation
    • capital market
    • emerging economies
    • IAS/IFRS
    • Kuwait

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