The Readiness of Libyan Commercial Banks to Implement International Financial Reporting Standard (IFRS) 18: A Case Study of the National Commercial Bank in Al-Bayda City

Abstract

This study is conducted within the context of the growing interest in the adoption of International Financial Reporting Standards (IFRS) in financial and banking institutions, particularly IFRS 18, which is considered one of the modern standards aimed at enhancing the presentation and disclosure requirements in financial statements. The primary objective of this research is to assess the readiness of the National Commercial Bank in Al-Bayda to implement this standard by analyzing three key pillars that represent the foundations of effective implementation: the level of employees’ knowledge and awareness of the standard, the technological readiness and information infrastructure, and the human and organizational readiness.

The study employed a descriptive analytical methodology and used a structured questionnaire as the main tool for collecting data from a sample of employees within the bank. The results revealed that the level of knowledge and awareness of IFRS 18 was moderate, indicating a basic level of understanding that requires further enhancement and development. The findings also indicated a noticeable deficiency in the technological readiness of the accounting systems and information infrastructure within the bank, in addition to a moderate-to-weak level of human and organizational readiness, particularly in aspects related to training, specialized expertise, and senior management support for transitioning to international standards.

Based on these findings, the study concluded that the National Commercial Bank is not fully ready to implement IFRS 18 in its current state. Effective implementation requires several preparatory steps, including updating technological systems, strengthening training and capacity building, developing a phased transition plan, and ensuring regulatory and legislative support from the Central Bank of Libya. The study ends by presenting a set of practical recommendations that can enhance the bank’s readiness to comply with international developments and improve the quality of financial reporting.