2008 ijgfm vol_1

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International Journal on Governmental Financial Management, 2008 Volume 1

Transcript of 2008 ijgfm vol_1

  • 1. International Journal on Governmental Financial Management Vol. VIII, No. 1, 2008 Published by The International Consortium on Governmental Financial Management Alexandria, Virginia United States of America International Journal on Governmental Financial Management - 2008
  • 2. International Consortium on Governmental Financial Management General Information Working globally with governments, organizations, and individuals, the International Consortium on Governmental Financial Management is dedicated to improving financial management so that governments may better serve their citizens. Our mission includes three key elements. First, it highlights that, within the international community, the Consortium is unique - it serves as an umbrella bringing together diverse governmental entities, organizations (including universities, firms, and other professional associations), and individuals. At the same time, it welcomes a broad array of financial management practitioners (accountant, auditors, comptrollers, information technology specialists, treasurers, and others) working in all levels of government (local/municipal, and national). Additionally the mission statement emphasizes the organizations commitment to improving government infrastructure so that needs of the people are better met. Our programs provide activities and products to advance governmental financial management principles and standards and promote their implementation and application. Internationally, the Consortium (1) sponsors meetings, conferences, and training that bring together financial managers from around the world to share information about and experiences in governmental financial management, and (2) promotes best practices and professional standards in governmental financial management and disseminates information about them to our members and the public. The International Consortium on Governmental Financial Management provides three options for membership. Sustaining Members: organizations promoting professional development, training, research or technical assistance in financial management; willing to assume responsibility for and to actively participate in the affairs of the Consortium. Each Sustaining Member has a seat on the ICGFMs Board of Directors and receives 10 copies of all ICGFM publications to be distributed within their organization and, where applicable, discounted registration fees. (Dues: $1,000) Organization Members: government entities with financial management responsibilities, educational institutions, firms, regional and governmental organizations, ond other professional associations. Six organization members serve on the ICGFMs Board of Directors and organization members receive 5 copies of publications to be distributed to their members, and where applicable, discounted registration fees. (Dues: $250/$150*) Individual Members: persons interested in, dedicated to, or working with activities directly related to financial management and who wish to be members in their own right. Six members of the ICGFM Board of Directors will be selected from among all individual members. Each individual member will receive a copy of all ICGFM publications, and where applicable, discounted registration fees. (Dues: $100/$50*) * A special discount is offered to developing countries with economics in transition and regional groups and organizations in such countries to encourage participation. This discount is not available to Australia, Canada, China, Eqypt, European countries (except transition economies), India, Iran, Israel, Japan, Kuwait, Libya, Mexico, New Zealand, Nigeria, Oman, Russia, Saudi Arabia, United Arab Emirates, USA, and Venezuela. Full time students also receive the 50% discount. International Journal on Governmental Financial Management - 2008
  • 3. Foreword We hope that you will enjoy the first issue of our journal under the editorship of Andy Wynne. We have taken this opportunity to change the name to the International Journal on Governmental Financial Management which we believe better reflects the scope and readership of the journal. We have included a wide variety of articles in terms of their geographical coverage, the first languages of the authors and the public sector financial traditions which are covered. We welcome contributions and suggestions for future issues of this journal which will maintain this tradition. The first article by PK Subramanian provides the results of implementing a World Bank diagnostic tool designed to assist the countries of South Asia in assessing how well their public sector accounting and auditing practices accord with the public sector accounting standards of the International Federation of Accountants, and the public sector auditing standards of International Organization of Supreme Audit Institutions. Despite the article arguing strongly for the adoption of international standards there, are significant differences between the level of compliance with these two main standards. The Supreme Audit Institutions of South Asia have already adopted the INTOSAI Auditing Standards whilst adoption of the public sector accounting standards remains to be achieved over the years to come. This may be due to the fact that the INTOSAI Standards were developed by the practitioners themselves and reflects existing good practice. The second article by Nikola Vukicevic and Rich Bartholomew describes an initiative which is designed to facilitate the sharing of good practice between public sector financial management practitioners in East Europe and Central Asia Region. Peer consultations offer an important tool for these purposes, since it enables professionals to learn practical approaches to key tasks and challenges from those who have similar responsibilities in other countries. It engages in two common activities, peer learning and benchmarking. Ayodeji Ogunyemis article considers quality initiatives and developments with the supreme audit institutions of Nigeria, Namibia, Lesotho and Mauritius. Ayodeji ends with the important question of whether successes in the development of the supreme audit institution act as a catalyst for wider gains in governance or is the pace of the growth of audit institutions limited by the pace of achievements in wider governance reform? The debate over the adoption of commercial style accrual accounting by the public sector does not appear to have been held back by lack of experience as the Chair of the IPSAS Board recently admitted that only six countries have actually issued accrual based financial statements. Rakoto Harimino Oliorilantos research in Madagascar looked at the reasons why accrual accounting had not been adopted by local government in this French speaking country, despite being required in official regulation. In contrast Norvald Monsen argues for the adoption of cameral accounting, developed in the public sectors of Germanic countries rather than private sector style accrual accounting. In recent years governments of Nigeria have taken some action against corrupt politicians and officials. This may have had some impact on reducing the importance of corruption, but it is still a live issue. The head of the main anti-corruption agency has recently been under pressure to leave for further studies and so the new governments commitment to this issue is in question. Kabiru Isa Dandago considers whether the constitutional fight against corruption has been enough? Femi Aborisade considers another aspect of public sector financial management in Nigeria which is of wider relevance, that of pension provision. The effectiveness of the reforms is questioned in terms of equity, transparency and poverty reduction. The paper by Awal Hossain Mollah considers the wider issue of accountability of the bureaucracy in the state of another medium size country, Bangladesh. The recent civil unrest and change of government, backed by the military, show the challenges and limits of such accountability. These events and this paper are important reminders of the wider environment in which public sector financial management operates in many countries. As always, we invite your comments on these papers and any prior editions (Public Fund Digest) as we debate the issues. You may find earlier editions on the ICGFM website at www.icgfm.org. Please contact me directly at [email protected] if you would like to contribute an article, or discuss any issue which you believe we should consider in the Journal. Alternatively, feel free to contact us by telephone, facsimile, or email ([email protected]). Andy Wynne Jesse W. Hughes Beatriz Casals Editor V-President, Communications President International Journal on Governmental Financial Management - 2008
  • 4. International Journal on Governmental Financial Management - 2008
  • 5. Table of Contents Public Sector Accounting and Auditing Diagnostic Tools for Comparing Country Standards to International Standards By: PK Subramanian. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Public Expenditure Management - Peer-Assisted Learning (PEMPAL) Initiative in Europe and Central Asia By: Nikola Vukicevic and R