New development: The conceptual underpinnings of international public sector accounting

The conceptual underpinnings of accounting standards are potentially very important for the future of public sector accounting internationally. The authors explain why and comment on the implications for public sector accounting.     

Book Reviews

References to ‘customers’ have become commonplace in the policy discourses within UK government and other public sector bodies. It is a working assumption of UK public sector management that the concept of the ‘customer’ can be applied to any public sector service agency or department; and this paper analyses how the UK government's revenue department, formerly titled the Inland Revenue (IR), re-characterised firstly taxpayers and latterly tax claimants as ‘customers’, rather than ‘users’, of IR services. This paper identifies some problems, dilemmas and ambiguities associated with this reconceptualisation in the context of an organisation that is predominantly a regulating department. Far from being merely a reclassification of the taxpayer as customer, the emerging discourse and associated practices of the IR were in part embedded in organisational change, including the merger with HM Customs and Excise to form the present-day HMRC. Thus this case analysis illustrates the limits of consumerism as a strategic tool of a government revenue department and raises wider questions for public management.     

A theoretical basis for public sector accrual accounting research: current state and perspectives

ABSTRACT

Public sector or government accounting has been the subject of many research endeavors. However, scholars have repeatedly criticized the lack of a consistent and well-defined theoretical basis for international research. So far, most researchers have drawn from various streams of theoretical perspectives with often unsatisfactory results. The goal of this paper is to put forward the International Public Sector Accounting Standards Board’s (IPSASB) Conceptual Framework as a point of reference for establishing a better-fitting theoretical basis for public sector accrual accounting research.     

A Comparative Analysis of the Public Spending Efficiency of the New EU Member States: A DEA Approach

This paper provides an analysis of the performance and efficiency of the public sector in the European Union (EU). Using composite indicators and data envelopment analysis, we focus on the new EU member countries, which were involved over the past decade in the accession and integration process. Results of the analysis indicate that, unlike "old" EU members, which invested more in sectors such as education or health, countries in Central and Eastern Europe, the "new" EU member states, have directed public resources mainly toward the performance of the government sectors. However, greater efficiency has been achieved precisely in those areas where they have invested less.     

What is a Conceptual Framework for Financial Reporting?

ABSTRACT

Despite more than forty years of exploration into constructing a conceptual framework (CF) for financial reporting the question ‘What is a CF?’ has not been adequately answered. The result is that those who construct CFs are not guided by a clear concept of a CF and communication about CFs is undermined by differences in understanding what it is. There has been a failure to undertake conceptual enquiry into the nature of a CF or into the expressions used in describing it. This paper addresses this failure by undertaking such a conceptual enquiry. Existing explanations of CFs are examined and found to be inadequate. What is wanted from a CF is identified and explained and this is used to prescribe what should be understood by the expression ‘conceptual framework’. A new characterisation of CFs is given that should assist any future construction of new CFs. Problems that may be faced by those who seek to construct a CF are identified.     

Budget Rules and Flexibility in the Public Sector: Towards a Taxonomy

The practices and norms of public budgeting have often been seen as a brake on the flexibility needed of government organisations. This remains true despite historically significant financial management reforms designed around budgetary devolution. Seeing flexibility as operating along two dimensions – devolution and discretion – this paper revisits the underlying features of traditional public budgeting to develop a taxonomy of six generic ‘budget rules’. By isolating key properties of budget control, the paper uses two of the more prominent rules – annuality and purpose – to illustrate how the rules interact to generate control capacity, as well as the scope for rule variability in promoting increased flexibility.     

Does the economy matter? Tough times,good times,and public service motivation

This paper describes a pilot study which explored the effects of different economic conditions on the public service motivation (PSM) levels of a small group of government and private sector employees in Malaysia. It address three questions: are the PSM levels of government employees significantly higher than those of private sector employees; are the PSM levels of employees significantly influenced by their perceptions of the external economic environment; and is the relationship between the economy and PSM affected by the sector of employment? Government employees’ PSM levels were found to be higher than those of the private sector employees, and were sensitive to perceptions of different economic conditions.     

A critical review of the 2015 South Korean civil service pension reform

The Republic of Korea’s civil service pension (KCSP) was established in 1960 and has been changed several times to overcome the serious financial burdens it has placed on the country. Major problems related to the KCSP include its structure (low contribution and high benefit) and the country’s rapidly aging population. The authors examine the 2015 KCSP reform, reviewing the reasons for the reform, its process, and its fiscal and policy implications. Reforms in other countries are briefly compared. The paper provides important lessons for researchers and practitioners involved in public sector pension reforms.     

Fraud: from national strategies to practice on the ground—a regional case study

The intentions of a number of national strategies and other initiatives to address fraud are reviewed in the context of one UK region. This paper considers how far various agencies in that region have responded to fraud. It then discusses which factors appear to have influenced the role of the strategies and other initiatives as an anti-fraud framework or to deliver anti-fraud work.     

我国政府财务报告改革的探讨

政府财务报告主要向社会公众提供有助于分析和评价政府的受托业绩及受托责任履行情况的财务信息,是政府与社会公众之间一座重要的信息沟通桥梁。改革政府财务报告是当前国际社会共同关注的会计问题之一。我国的政府财务报告同样需要改革完善,以期能让政府财务报告适应市场经济的需要,更好的反映政府财务状况。     

Sub-sovereign bond buyback: a way forward for debt-laden regions in austerity

ABSTRACT

Previous academic literature has criticised bond buyback as a ‘”boondoggle” benefiting a country’s creditors’—meaning that buybacks are a wasteful use of public money. This paper challenges the narrow financial–economic perspective behind that statement by adopting a broader socio-political framework that includes the potential benefits of buyback for citizens, not just financial market costs. In particular, buyback does not necessarily require a budget surplus via higher local taxes and/or increased austerity measures.     

Relationship marketing,relational capital and the future of marketing in public service organizations

This article proposes an innovative model of marketing practice for public services. This is rooted in the paradigm of relationship marketing and emphasizes the need to build relational capital between and within organizations operating in the public services arena. It is argued that this is essential for the effective management of contemporary public services in the fragmented state.     

Far from Well: The UK since COVID-19, and Learning to Follow the Science(s)*

This paper offers a five-part framework for assessing why the United Kingdom has coped poorly compared with peer countries with the medical, social and economic challenges brought by the COVID-19 pandemic – a surprising failure, given the strength of its scientific community and the internationally attested quality of its civil service. The paper also offers a proposal for how to shape an independent inquiry, one promised by the UK Prime Minister, of the kind that has the primary motivation to better prepare the country for future crises. The paper begins by providing various metrics that set out how the UK has, as of late 2020, been particularly adversely affected by the pandemic. It then details the five-part framework, which is presented as a series of propositions with initial supporting evidence that require more thorough investigation, supported by a fuller record of evidence. First, we suggest that there have been problems as to how evidence about the pandemic and its anticipated effects was collected, processed and circulated, weakening policymakers’ ability to evaluate the risk calculus. Second, particular structures and processes of government decision-making appear to have been inadequate and ill-suited to the multidimensional challenges brought by the pandemic. Third, the role of political leadership and decision-making in the public health and broader policy responses needs thorough evaluation. Fourth, we assess some aspects of economic policymaking during the pandemic. Fifth, features of the UK's institutional make-up may have been a driver of the suboptimal outcomes. Overall, we argue that UK policymakers may have over-relied on the medical sciences at the expense of other (social) scientific evidence.     

Size and Administration Costs in the Voluntary Sector: A Note

Despite the recent major changes to regulation of the voluntary sector as a result of the Charities Acts 1992 and 1993 the independent Commission on the Future of the Voluntary Sector has now suggested further major changes in the definition and control of the sector. This paper looks at the growth of registered charities during this decade compared with the decline in the number of registered companies and examines evidence on economies of scale in the charities. Possibly charities should be encouraged to promote mergers and acquisitions as a means to greater efficiencies in charitable activity.     

Public service motivation and public sector employment preference: Comparing Italian and British students

ABSTRACT

Previous research has suggested that an individual’s public service motivation (PSM) is positively linked to a preference for public sector employment. The authors explore this link using a sample of British and Italian undergraduate students. They found a positive relationship between PSM and public sector job preferences among Italian students but not with the British students. The UK has implemented more NPM-style reforms than Italy and this could be impacting on public sector recruitment. Implications for recruitment and retention the public sector are discussed.     

The Role of Prices for Excludable Public Goods

When a public good is excludable it is possible to charge individuals for using the good. We study the role of prices for publicly provided excludable public goods within an extension of the Stern-Stiglitz version of the Mirrlees optimal income tax model.We show that for a public consumer good there is a range of circumstances in which charging a price for the public good decreases welfare. We find that a necessary condition for a positive price to be desirable is that the marginal valuation of the public good is increasing in leisure. However, even under this condition, welfare is initially decreasing in the price, implying that charging a lower than optimal price may be less efficient than setting a zero price. Thus, even when there is a case for charging a price for the public good, an attempt to implement the optimum in practice may be risky, as even setting a modest price to avoid overshooting the optimum may be Pareto inferior to charging no price at all. The policy case for a price may thus appear rather weak. We also find that producers using an intermediate excludable public good as an input should not be charged a price for using the good.     

Polish Public Sector Accounting in Transition: Evidence From the Mid 1990s

The Polish public sector is still under transition that began at the turn of 1989/1990. In the mid-1990s a new significant development in public sector accounting took place. A substantial differentiation of the accounting system was introduced. New elements and relationships appeared, along with general domination of the Accounting Act, tax regulations and the Budgetary Law. The system of basic regulation of accounting and reporting has also changed. There were also some changes in the auditing system. The enactment in 1994 of the Accounting Act has brought to light the political character and political importance of financial information in Poland. This paper presents the current mode of public sector accounting regulation and its relationship with the overall system of Polish accounting regulations. Much attention has been devoted to specific principles of public sector accounting and financial reporting in the public sector, and to government accounting. Some political contaminations and consequences of the current accounting system have been pointed out.