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Review
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Public accountability and government financial
reporting
Farzad Eivani1, Kamran Nazari2
and Mostafa Emami3*
1Department
of Accounting, School of Social Science, Razi
University, Kermanshah, Iran.
2Department
of Business Management, Payam Noor University,
Kermanshah, Iran.
3Young
Researchers Club, Kermanshah Branch, Islamic Azad
University, Kermanshah, Iran.
*Corresponding
author. E-mail: Emamemostafa@yahoo.com. Tel
+989183854194.
Accepted 5 June, 2012
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Abstract |
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New
Public Management" requires the introduction of competition
within the Government to increase financial transparency and
improve government performance. The major role of financial
reporting is the effective transfer of financial data to people
who are outside the organization in a way that is valid and
timely one of the most important goals of which is to provide
necessary data to evaluate the function of an economic agencies
and its ability to make profits. The necessary condition to
achieve this is to provide financial data in such a way that the
evaluation of the previous functions becomes possible and
effective in measuring the ability to make profits and in
predicting future activities of economic agencies.
The major role of financial reporting is the effective transfer
of financial data to people who are outside the organization in
a way that is valid and timely; one of the most important goals
of which is to provide necessary data to evaluate the function
of an economic agencies and its ability to make profits.
Government accounting and financial reporting aims to protect
and manage public money and discharge accountability. These
purposes, and the nature of public goods and tax financing, give
rise to differences with commercial accounting. In order to
achieve ambitious socioeconomic goals, developing countries
require public sector institutional capacity for setting and
implementing public policy, which in turn necessitates
government accounting reform. The social value of government
accounting reform therefore lies in its contribution to
development goals, including poverty reduction. Public
accountability of government is demonstrated in part by
accounting standards that require fair presentation and full
disclosure. In the United States, many of these standards are
developed by the Governmental Accounting Standards Board (GASB).
The paper revealed that the effective implementation of
development policies and programmes is anchored on purity of
action, honesty of purpose, probity and integrity, which are
important hallmarks of accountability and transparency.
Financial reporting is the best index of accountability. The
accountability and control apparatus in the public service has
some minimum technical components that should elicit tolerable
standards of accountability and transparency. There are
reasonable regulations, adequate albeit outdated accounting
procedures, stringent sanctions and financial auditing. The
major problem however, is with the human component indices of
commitment, honesty, integrity and transparency. The apparatus
for managerial and programme accountability are either weak or
non-existent. Consequently, the quality of the financial
statements should be improved, the system should create room to
inculcate both managerial and programme accountability
apparatus. The human component-individual accountability should
be seriously considered.
Key words:
Public accountability, government, accounting reform, government
financial. |
