资源描述
Is cash still king? Maximising the benefits of accrual information in the public sector 2020 Association of Chartered Certified Accountants February 2020 About ACCA ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants, offering business- relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. ACCA supports its 219,000 members and 527,000 students (including affiliates) in 179 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 110 offices and centres and 7,571 Approved Employers worldwide, and 328 approved learning providers who provide high standards of learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence. ACCA has introduced major innovations to its flagship qualification to ensure its members and future members continue to be the most valued, up to date and sought-after accountancy professionals globally. Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. More information is here: About IFAC IFAC (the International Federation of Accountants) is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. Comprised of over 175 members and associates in more than 130 countries and jurisdictions, IFAC represents almost 3 million accountants in public practice, education, government service, industry, and commerce. Over four decades, IFAC has represented the global profession and supported the development, adoption, and implementation of international standards that underpin the contributions of todays global accountancy profession. IFAC has maintained a long-term approach to building and strengthening a global accountancy profession that supports transparent, accountable, and sustainable organizations, financial markets, and economies. More information is here: ifac Is cash still king? Maximising the benefits of accrual information in the public sector About this report There is a global transition underway, where governments are moving from a cash to an accrual basis for their financial reporting. This report offers lessons learned from jurisdictions that have implemented accruals, with the intention that this global transition to accruals creates real value and is more than a compliance exercise. AUTHORED BY: Alex Metcalfe Head of Public Sector Policy, ACCA Karen Sanderson, FCCA Foreword Pensioners without pensions. Schools without students. Wells without water. These are just a few human consequences that can result and do result when governments dont have the financial information necessary to make the best long- term decisions for their citizens. Cash accounting, which 75 percent of governments around the world use in some form, is of course useful. But ultimately, cash accounting doesnt present the most accurate picture of a governments financial health, nor does it enable decision makers in the public sector to adequately plan for the development, delivery, and maintenance of the services, programs, and infrastructure on which people rely. And that, in turn, leads to a breakdown of trust in governments. Accrual accounting creates the ability to recognize, value and manage public sector assets and liabilities. A government using accrual accounting has, for example, the mechanism to record where its wells are and assign them value based on their working condition crucial in assessing whether they are delivering lifesaving water for people. In cash accounting, conversely, the construction costs are recognized in year one, but after that visibility is lost. There are essentially no records to help track the utility of the well, whether it needs maintenance, whether there are funds for more wells. This is an actual example discussed in this report, and one that reminds us of the very tangible impacts that accrual accounting systems can have on human lives. While wells might be the order of the day in some jurisdictions, other economies would benefit from public sector accrual accounting that enables the effective management of liabilities. For example, this would be crucial to the health of a pension system or the development of a carbon offset program. Regardless of the application, accrual accounting and budgeting is a game changer. Its why we, as IFAC and ACCA, are so committed to the support, adoption, and implementation of International Public Sector Accounting Standards (IPSAS) that underpin public sector accrual accounting, and to the development of a robust profession with the capacity to understand, implement and manage such systems. We are very encouraged that the 2018 International Public Sector Financial Accountability Index found that 65 percent of governments surveyed have implemented accrual accounting, or plan to implement it by 2023. The report that follows not only confirms that a complete public sector transition to accrual accounting will serve the public interest, but also contains 30 specific recommendations to improve accrual implementation. To the finance professionals and public sector decision makers who are leading this important transition, we commend you and support you. Kevin Dancey CEO, IFAC Helen Brand CEO, ACCA Contents Executive summary 6 Introduction 11 1. A time of transition: the current reporting environment 13 2. The benefits of accruals in the public sector 17 3. Creating decision-useful information 32 4. Key findings and recommendations 44 Conclusion 47 Panel of international experts 48 References 49 The foundation of good decision making is having the right information. Most government decisions have a financial aspect and knowing what the government owns and owes, as well as understanding the economic reality of its activities, improves the quality of the decisions made. benefits and level of complexity arising from different models of financial reporting and budgeting. Governments reporting and budgeting on a cash basis (Column A) can achieve basic fiscal discipline through the allocation of cash budgets. Column B describes the benefits observed for governments reporting on an accrual basis but still operating cash budgets, where governments are able to support better long-term and fiscally sustainable decision making than when working purely on a cash basis. Column C shows the benefits obtained by jurisdictions operating on an accrual basis for financial reporting and budgeting, where, in addition to the benefits of Column B, this approach puts finance at the heart of government decision making. The experts noted a higher degree of complexity resulting from using inconsistent bases for appropriations, budgeting and reporting, which reduces the comparability between governments financial information and can obstruct proper financial accountability. TRANSPARENCY, ACCOUNTABILITY, CREDIBILITY AND VALUE FOR MONEY The information created by reporting public accounts on an accrual basis creates opportunities for improving accountability and transparency. This view resonated with the global community of experts interviewed for this project. This new information facilitates conversations by decision makers and the public on the appropriate allocation of public resource. Several of the experts said that moving to accruals-based accounts and, in particular, following International Public Sector Accounting Standards (IPSAS), means that information is being produced in a consistent manner across the public sector, making the information more accessible and comparable between entities. Some experts also commented that having accruals-based financial reports made them understandable by more people as they are more comparable with private sector accounts. The transition to accrual accounting can improve the fiscal credibility of a government, and for less mature or 6 Accruals-based accounts provide more complete information than cash-based accounts and around the world there is a drive for governments to implement accrual accounting. The 2018 International Public Sector Financial Accountability Index Status Report (IFAC and CIPFA 2018) found that many central governments (40% of those surveyed) are planning to implement accrual accounting by 2023. The finance professionals and public sector leaders in these countries are the intended primary audience for the present report where they will find 30 recommendations to improve accrual implementation in Chapter 4. BENEFITS OF ACCRUALS IN THE PUBLIC SECTOR The experts consulted for this project identified transparency, accountability, fiscal credibility and the production of decision-useful information as the overriding benefits of accruals implementation. The benefits achieved depend on the level and type of implementation. Table I.1 sets out the Executive summary 7 Is cash still king? Maximising the benefits of accrual information in the public sector | Executive summary TABLE 1: Benefits and complexity arising from each accounting and budgeting basis (A) CASH ACCOUNTING AND CASH BUDGETING (B) ACCRUAL ACCOUNTING AND CASH BUDGETING (C) ACCRUAL ACCOUNTING AND ACCRUAL BUDGETING BENEFITS Provides basic fiscal discipline Simpler / intuitive for non- financial staff and the public Facilitates public scrutiny Improved accountability Provides fiscal credibility Achieving value for money and financially sustainable decision-making Managing assets well and accounting for the maintenance backlog Managing liabilities and identifying fiscal risks Reducing fiscal illusions and improving incentives Supporting long-term thinking The benefits in Column B PLUS Puts finance at the heart of decision- making Embeds performance management Improves medium-term forecasting and planning o Further enhances fiscal credibility Effective project management across government Embeds the finance function in day-to-day decision-making LEVEL OF COMPLEXITY Low High Medium Accrual accounting information can also be helpful when an asset comes to the end of its useful life and is useful for decision makers in understanding where resource should be allocated to finance the replacement of assets. This reporting can be helpful in improving the management of assets and ultimately improving the quality of public services derived from government assets. MANAGING LIABILITIES AND IDENTIFYING FISCAL RISKS Accruals can benefit public sector organisations by providing information to improve the management of liabilities and allows governments to take decisions that support their objectives without burdening future generations with unmanageable debt. For governments to maintain a sustainable financial position, effective management of their liabilities is necessary. The experts consulted have provided examples of policy discussions that were better informed by accrual information. Accrual accounting also creates new information on contingent liabilities, which can be helpful for governments in identifying fiscal risks. Analysis by the International Monetary Fund (IMF) shows that realised contingent liabilities can have a substantial impact on public sector balance sheets. REDUCING FISCAL ILLUSIONS AND PERVERSE INCENTIVES Experts identified examples of fiscal illusions (ie accounting devices that give the illusion of change without its substance). Information generated by accrual accounting can dispel these illusions and can support sustainable decision making in public finance. The move to accrual accounting can help in creating a fiscal framework with targets that recognise the impact of decisions on the public sectors balance sheet. Without this, there will be significant temptation to shift costs outside the scope of fiscal targets even where such a decision would not provide good value for money. The benefits of having a strong net worth position suggest that governments should consider using net public sector wealth as a key indicator in setting their fiscal rules. Whole-of-government accounts, prepared using accruals, give a more holistic picture of a governments financial position. It is only possible to provide a full financial picture of the resources and risks for the public sector if there is full consolidation, which must include state-owned enterprises (SOEs) at whole of government level. The additional information provided through accrual accounting means that government decision makers are better developing economies the move to accrual accounting can lead to increased confidence in public financial management. At the same time, the implementation of accrual accounting can create barriers to effective transparency if the information included cannot be understood. 1 There is therefore, a key message for governments: that they must consider how best to communicate the new information arising from accrual accounting. Experts also noted that accrual accounting can strengthen the accountability mechanisms in government. Parliamentary committees have played a role in holding governments to account using the new information provided by accrual accounting. MANAGING ASSETS WELL AND ACCOUNTING FOR THE MAINTENANCE BACKLOG Generally, public sector assets are held because they are needed for the delivery of public goods or services and would likely need to be replaced if they were damaged. Cash-based accounting can discourage maintenance whereas, through financial reporting, accrual accounting recognises the cost associated with deterioration in the condition of assets. New information available through accrual accounting aids in identifying where asset maintenance is inadequate. 1 See the work by David Heald on the difference between nominal and effective transparency. For example, see Heald 2015. Is cash still king? Maximising the benefits of accrual information in the public sector | Executive summary informed on the range of liabilities and risks facing the public sector and can then consider what steps should be taken to reduce or mitigate these challenges. SUPPORTING LONG-TERM THINKING AND PLANNING There are clear examples of how governments can use the information generated through accrual accounting to support their long-term planning and policymaking. It is no surprise to see that governments that use accruals-based accounts take a longer-term view of their finances than those that rely on a cash basis. Strong balance-sheet management supports low borrowing costs and provides flexibility for governments to respond to emerging pressures, and allows them to absorb fiscal shocks. Accrual accounts are useful in informing governments fis
展开阅读全文