Developing a Conceptual Framework for Central Government Financial Reporting: Intermediate Users and Indirect Control

2003

Public Administration

187

155

Greater fiscal transparency is seen by its advocates as a means of improving economic governance arrangements in ways which, by promoting fiscal stability, will in turn improve the functioning of the government sector and facilitate improvements in the economic environment for the private sector. 'Fiscal transparency' is much acclaimed by policy-makers, not only in the UK Treasury but also by the IMF and OECD. Fiscal transparency can have substance or can just be voguish incantation. This article explores the meaning of fiscal transparency, by examining its structure and evaluating criteria for assessing the degree of fiscal transparency attached to particular sets of circumstances. It explores the link between transparency and accountability, developing the distinction between event and process transparency. Consideration is given to the trade-off between the value of sunlight (to employ an analogy) and the danger of over-exposure. The performance of the United Kingdom against emerging international best practice is examined, with regard to both public expenditure and taxation. By international standards, UK fiscal transparency is high. Nevertheless, there is a major gap between UK rhetoric and practice, indicating a divergence between nominal and effective transparency. This is evidenced by: frequent changes in public expenditure definitions; the non-publication of important analyses; the location of certain liabilities 'off-balance sheet'; and a lack of candour about tax policy.

Section: Trade-offs Among Valuesmentioning

confidence: 99%

Section: Role Of Information Brokersmentioning

confidence: 99%

Fiscal Transparency: Concepts, Measurement and UK Practice

2003

Public Administration

187

155

“…Timeliness in financial reporting is important for several reasons, which have been discussed in the literature (Drebin et al, 1981;and Rutherford, 1983). In terms of public accountability, which has to be constructed on the basis of public entitlements to information about the activities of government (Likierman and Creasey, 1985), timeliness is an essential feature.…”

Section: Criteria Of Evaluationmentioning

confidence: 99%

“…Timeliness is among the issues currently being addressed by the Accounting Standards Board (2003, para 3.1) in its interpretation for public benefit entities of its Statement of Principles for Financial Reporting (ASB, 1999). The difficulty of establishing user groups for government financial reports (Rutherford, 1992) should not be used as an argument that a lack of timeliness is unimportant. Even if there are no direct users, the fact that there is a public record of the completion of the annual financial cycle provides some measure of assurance.…”

Section: Criteria Of Evaluationmentioning

confidence: 99%

The Implementation of Resource Accounting in UK Central Government

2005

Financial Acc & Man

At the end of a long process of transition from cash accounting, UK central government departments discharged their public accountability in 2001–02 by presenting Departmental Resource Accounts (DRAs) to Parliament. This article assesses the implementation of Resource Accounting, focusing on timeliness (measured by certification lags) and accounts quality (measured by the property of not being qualified). The descriptive statistics indicate substantial variation in certification lag. The estimated OLS regression model has strong explanatory power. Explanatory variables include those that can be regarded as enduring and those that are attributable to the transition process. The enduring variables are: new DRA, consolidation, audit qualification and pension scheme (whose statistically significant positive coefficients show that these are associated with longer certification lags) and percentage of Appropriations‐in‐Aid (statistically significant negative coefficient). The transitional variables are Executive Agency and a dummy for 2001–02 (whose statistically significant negative coefficients show that these are associated with shorter certification lags). Potential for shorter certification lags is identified, as are administrative deficiencies that delay the arrival of some certified DRAs into the public domain. Accounts quality improved during the transition period, though problems still occur in some departments that are important in terms of expenditure and assets.

“…Much of the published information, whether crude or sophisticated, receives only cursory media and political attention. The dilemma emphasised by Rutherford (1992), namely the difficulty of finding an audience for governmental financial reporting, is underlined. Naturally, the annual reports of these nine executive agencies are seen as vital to their external accountability.…”

Section: External Accountabilitymentioning

confidence: 99%

Executive Agencies within the Scotland Territorial Programme

Geaughan

1997

Financ Acc Manag

This article supplements the cross‐sectional survey literature by focusing upon a subset of executive agencies which, though highly disparate on many dimensions, share the experience of being part of the command of the Secretary of State for Scotland. Agencies operating within the context of territorial management face markedly different operating environments. In particular, centralised financial control by the territorial department is an essential continuing feature of the public expenditure control system. The characteristics of those activities which have been agencified in Scotland are closely examined, followed by an evaluation of the implications for internal management, external accountability, the reform of the parliamentary system of Supply, and the extension of accruals accounting across central government.