Suggests a notion of community assets based on common property that
recognizes the fundamental importance of accountability and democratic
control over resources in the public sector, the sociopolitical nature
of accounting, and the need to give visibility to public as well as
private interests. The development of such a concept has immediate
effects on the way the accounting entity and the relationship between
government and society are viewed and may even have ramifications for
accounting in the “private” sector.
This article explains the structures and rules built into the New Zealand government's financial management system which encourage entry into commitments such as public private partnerships. That the system provides a means of escape from the tight constraints imposed by fiscal targets, and escapes public and parliamentary scrutiny in the process, seems at odds with espoused objectives of fiscal responsibility, debt reduction and transparency. In terms of furthering a privatization agenda, however, it is highly logical.
Internationally, there has been mounting interest in the subject of accounting for infrastructure assets and their deterioration. In New Zealand, the adoption of full accrual accounting across the public sector from 1989 has meant that local authorities have been grappling for some time with the problem of how best to account for these assets in a manner which is relevant for both managers and elected representatives. This paper reviews methods of accounting for infrastructure in New Zealand local authorities, and explores how infrastructure assets and related expenses might be accounted for in a manner which is consistent with both the New Zealand accounting profession’s conceptual framework and the requirements of democratic decision making over the allocation of resources.
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