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Why does getting public sector accounting right matter?

22 June 2012
This is a side feature on the news story: ‘Commonwealth countries urged to strengthen their financial accounting’

'Commonwealth countries urged to strengthen their financial accounting'

CIPFA Chief Executive Steve Freer:

“Government finances affect the quality of important public services like schools and health, the success of the economy, the growth of jobs and trust and confidence in politicians.

“If you get it right you end up with a better, more accountable, more transparent government that makes better decisions about how to use its resources.

“With poor financial management you tend to have resources being used less well or even squandered or wasted.”

Assistant Director International, CIPFA, Peter Boulding:

If they get it wrong: “Individual countries can face a lot of the problems you are seeing now particularly in the Greek economy: the austerity, the breakdown of pensions, the breakdown of trust between the people and the government, rioting in the streets, demonstrations and aggressive behaviour, so a destabilisation of society can be caused by the failure of good public services.

“If public services are not delivered properly and effectively, properly funded and financed, people suffer - they have poor schools, poor roads, poor public housing, all of these are affected.

“Their life chances are in jeopardy if public finance is not organised properly and part of that is accounting properly.”

What needs to be done from here?: “This is just one event and it needs to be fully built up and developed and the lessons taken forward by governments and politicians, and not just in the Commonwealth countries represented here.

“There also needs to be a building up of the human capacity - the number of professional accountants in countries that can support these types of measures and deliver on the quality of accountancy that good governance needs.”