Purpose It is important to have a literature review to open any special issue as a way of introducing the state-of-the-art topics and link past research with the papers appearing in this special issue on IC in education. The paper aims to discuss this issue. Design/methodology/approach This research uses the structured literature to investigate the state-of-the-art and future directions of IC literature in education. In total, 47 articles are explored including nine from this special issue. Findings IC in education research is concentrated in Europe and mainly addresses IC in universities. Additionally, current IC research is progressing by examining IC practices inside universities using a third-stage IC approach, with new research also concentrating on third-mission outcomes, thus there is scope to continue IC and education research beyond universities. IC in education can also expand into fifth stage IC research, which abandons the boundaries of the educational institution and concentrate on the impact of IC and education on multiple stakeholders. Research limitations/implications Current IC in education research is too narrow and mainly investigates IC in European contexts using case study methodology. However, there is ample scope to widen research that develops new frameworks in different educational and country contexts using a wider range of research methodologies. IC in education needs to expand its boundaries so it does not lose its relevance, and thus be able to contribute to wider policy debates. Originality/value This paper presents the current state-of-the-art structured literature review of the articles investigating IC in education.

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Purpose The purpose of this paper is to review and analyze the literature on consolidated financial statements (CFS) in the public sector published from 1980 to 2015 in public sector accounting and management journals, and propose a future research agenda. Design/methodology/approach Adopting a structured literature review methodology, the authors investigate how the CFS literature is developing and what its focus is. Findings The authors identify five major topics: the definition of the consolidation area; the identification of the reporting entity; the private vs public sector accounting standard dichotomy; the relationship with the statistical rules; and the usefulness of CFS. Originality/value The authors analyze these topics, highlighting the growing implementation of CFS in different contexts (mainly focusing on governments outside the USA) and provide suggestions for future research.

Public sector consolidated financial statements can be drafted according to different approaches, especially the “control approach” or “budgetary perspective.” Considering the growing importance of the International Public Sector Accounting Standards (IPSAS) in the international scenario, the aim of the article is to investigate these approaches through an analysis of the comment letters submitted to the Exposure Draft no. 49, which will replace the current IPSAS 6. The main finding concerns the acceptance of the key role played by the control approach, even though it needs to be better specified, in order to take into account the public sector characteristics

Purpose The purpose of this paper is to examine earnings management practices in local governments (LGs). The implementation of accrual accounting in LGs opens the way for empirical research on the topic, as reporting high surpluses or high deficits can be negatively interpreted by the central government, monitoring authorities, citizens and political opponents. According to public choice theory, the conflicting interests between politicians, who pursue re-election, and voters, who observe politicians’ actions to assess their alignment with social welfare, create fertile ground for earnings management practices. Design/methodology/approach The study calculates discretionary accruals, by using the Jones (1991) model, and relates them to several political variables. It employs a large sample of Greek and Italian LGs. The Greek database covers the period from 2002 to 2015 with about 4,300 observations, and the Italian database includes the period from 2008 to 2015 with about 1,130 observations. Findings The findings from the analysis give evidence that LGs engage in earnings management. The principal factor is the electoral cycle, as earnings management seems to be greater when the mayor is re-elected than when the mayor is elected for the first time. Furthermore, the period before elections create conditions that cultivate earnings management attitudes. Research limitations/implications Previous studies have principally investigated earnings management in the private sector. Considering that many public-sector entities have implemented accrual accounting systems, this study intends to examine earnings management behaviour at the LG level, providing interesting findings for researchers and policy makers. Practical implications A better understanding of the political factors and the financial conditions, which act as obstacles or facilitators, should work hand in hand with the accounting reforms. The usefulness of financial statements for decision making and control presupposes that they are of high quality, an attribute that can be impaired by earnings management. Originality/value This study investigates the influence of political factors on earnings management behaviour in public-sector contexts where self-interest and accountability pressures coexist.