An Explanation of Local Government Debt in Spain Based on Internal Control System

Gras, Ester; Hernández, Joaquín; Palacios, M. Hevia

doi:10.4335/12.4.775-792(2014)

Cited by 11 publications

(9 citation statements)

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“…There are empirical studies that use the internal management system to relate the internal control function of local entities to the level of indebtedness (Gras et al, 2014) or the internal control function to the cost of equity (Ashbaugh-Skaife et al, 2009).…”

Section: Internal Controlmentioning

confidence: 99%

Relation between internet financial information disclosure and internal control in Spanish local governments

Moreno‐Enguix

Gras‐Gil

Henández-Fernández

2019

AJIM

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Purpose The application of new public governance by many countries has led to the creation of new management systems in public administration and the development of an effective accounting structure with efficient internal control to guarantee a proper provision of services that meet citizens’ requirements. The purpose of this paper is to focus on Spanish local government with the intention of determining the impact of the internal control structure on the disclosure of financial information on the internet. Design/methodology/approach The empirical analysis used combines a descriptive aspect with an explanatory one and seeks to answer the question of whether the internal control system (ICS) influences the disclosure of financial information on the websites of Spanish LGs. The authors use a multivariate model that allows us to verify the predictive capability of the previously defined explanatory variable, internal control, in 1,806 local governments. To test the hypotheses, the authors use two different models. Findings The authors consider the existence and quality of the financial information disclosure in relation to ICSs, and a series of financial and non-financial variables. The authors conclude that the structure of the ICS influences financial information disclosure and its quality. Also, the socio-political variable gives a better explanation of financial information disclosure than the financial variable. Originality/value This research is novel to determine whether the development of ICSs in Spanish municipalities has favored and increased the disclosure of financial information financial through the municipalities’ website transparency portal. These findings will contribute to increase the importance of internal control in the management of public entities.

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Section: Internal Controlmentioning

confidence: 99%

Relation between internet financial information disclosure and internal control in Spanish local governments

Moreno‐Enguix

Gras‐Gil

Henández-Fernández

2019

AJIM

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“…Authors [21,22,23] frequently emphasize the importance of the public regulation of indebtedness by higher government, but at the same time they point out that while the applied fiscal rules lead to the control of local indebtedness, they can lead to limited investments in local infrastructure and to time delays. A counterweight of higher control and regulation can be the internal control of municipalities themselves [24].…”

Section: Brief Research On the Related Literaturementioning

confidence: 99%

Global COVID-19 Pandemic and Indebtedness of Municipalities with Extended Power in the Czech Republic

Lajtkepová

2021

SHS Web of Conf.

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Research background: In theory, indebtedness of municipalities is only ever associated with the acquisition of investments. It is advised that indebtedness should be regulated by the state, but there is a risk of limiting investment in local infrastructure. Purpose of the article: According to Act No. 23/2017 Coll., municipalities must regulate their own indebtedness and comply with the fiscal rule on pain of penalty. The aim of this text is to provide an analysis and examine the prospects of compliance with the fiscal rule in 205 municipalities with extended power. The analysis is carried out between 2017 and 2019, the risks of compliance in the following years mainly relate to the emerging economic crisis caused by the COVID-19 pandemic. Methods: Given the subject of the analysis, secondary data was used for the research. Data was taken from the Monitor database operated by the Ministry of Finance of the Czech Republic. The obtained data had been processed using standard statistical methods. Findings & Value added: To date, the indebtedness of municipalities with extended power is not excessive: the mean and median values are still well below the legal limit. Still, there are some municipalities where the legal limit has been exceeded, or whose indebtedness is nearing the limit. In the event of reduced tax revenue, which is to be expected in the coming years, these municipalities will struggle to comply with the fiscal rule. The consequences will include halting or limiting local investment, and/or reducing the quality of local public goods.

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“…Indebtedness (DEBT) : This financial variable is measured by dividing the level of debt and the number of inhabitants (indebtedness per capita). This variable is used in many theoretical and empirical studies (Benito and Bastida, 2004; Balaguer, 2002; De Mello, 2001; Brusca and Labrador, 1998; Brown, 1996; Dickson and Yu, 1997; Kiewiet and Szalaky, 1996; Gras et al , 2014).…”

Section: Metodology Data and Variablesmentioning

confidence: 99%

Gender and internal control systems in Spanish local governments

Gras‐Gil

Moreno‐Enguix

Henández-Fernández

2020

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Purpose The presence of women is lower than that of men in positions of responsibility in economic management in public administration, although there has been a more significant increase in local administration. The purpose of this study is to determine whether the application and development of the internal control system in local governments improves through the presence of women in positions of management and responsibility in these institutions. Design/methodology/approach The authors use a multivariate model that allows them to verify the predictive capability of their previously defined explanatory variable gender in 1,527 Spanish local governments. They analyze the empirical relation between the gender and internal control system by multivariate regression models. Findings The authors find that the presence of women in management positions in local governments affects internal control system influences as well as a series of financial and non-financial variables. They conclude that in local governments of more than 50,000 inhabitants, the presence of women in the management has a positive influence on internal control systems and also promotes transparency and a more effective fight against corruption, thus enhancing internal control systems. Research limitations/implications The presence of women in positions of management and responsibility in local government will favor a decrease of corruption in local governments and increase their efficiency and transparency. This study can facilitate women’s access to positions of more economic and financial responsibility in public administration, as well as improve the management and efficiency in these institutions. Originality/value This research is novel in that it determines whether the application and development of the internal control system in local governments improves through the presence of women in the position of management and responsibility in these institutions.

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An Explanation of Local Government Debt in Spain Based on Internal Control System

Cited by 11 publications

References 0 publications

Relation between internet financial information disclosure and internal control in Spanish local governments

Relation between internet financial information disclosure and internal control in Spanish local governments

Global COVID-19 Pandemic and Indebtedness of Municipalities with Extended Power in the Czech Republic

Gender and internal control systems in Spanish local governments

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