If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.Abstract Public heritage facilities ± national parks, art galleries, museums and so on ± are now required by professional accounting standards in Australia to be valued and included in government general purpose financial statements as assets. This study challenges the appropriateness of such an accounting treatment in relation to the SAC4 definition of assets and the purported usefulness of the information. Instead it is argued that these facilities are public goods, and that commercial accounting principles should not be applied to them. The article explains the nature and significance of public goods and how they differ from private goods. It explains why commercial accounting principles are irrelevant for public heritage facilities because their objectives are social rather than financial and why commercial valuations are irrelevant and unreliable if applied to them. Finally, it is contended that the facilities are assets held in trust for the nation by government and hence should not be included in its general purpose financial reports.The current issue and full text archive of this journal is available at

Professional accounting standards have been applied to the public sector in Australia as part of the process of adopting accrual accounting. However, the reason given for their application to the public sector is questionable. The modes of operation of governments and of the business sector are very different, and accounting standards must be tailored to suit the specific information needs of each sector for the accounting systems to provide relevant information. The four Accounting Concepts Statements and the broad requirements of AAS 29 and AAS 31 are examined to show where changes are needed in the standards to make their information more relevant to the needs of the public sector. These changes would better enable accrual accounting information systems to assist in enhancing the efficiency and effectiveness of public sector operations and the accountability of governments to parliament and citizens.

Accrual accounting has been central to financial management reforms designed to promote greater efficiency, effectiveness and accountability in the Australian public sector. This is the setting for the article; however, the issues covered apply to all nations that have reformed their public sectors over recent years. The results of the reforms have been mixed. While accrual accounting has had some beneficial results for the above purposes, the benefits have been offset by aspects of accounting misuse resulting largely from adoption of the business model of accrual accounting, termination of the former cash accounting system, and adoption of some questionable marketization reforms which appear to be more driven by the objective of reducing the size of government rather than enhancing efficiency of operations. Because Treasury believed that the business model was not appropriate for budget fiscal policy purposes, it introduced a second combined accrual and cash accounting system-the Government Finance Statistics system. The use of two accrual accounting systems reporting different results caused much confusion in parliament.

A debate in this journal, spanning severa1 years, over the accounting treatment of public assets has concentrated attention on the appropriateness of the Public Sector Accounting Standards Board's decision to apply private sector accounting concepts to the development of public sector accounting standards. The Case is examined here and it is shown why private sector accounting standards must be appropriately adapted to suit a very different and varied operating environment in the public sector. These differences have been largely ignored, with resulting problems for public sector accounting standards.