Bernardino Benito

The harmonization of government financial information systems: the role of the IPSASs

The publication of International Public Sector Accounting Standards (IPSASs) in the field of governmental financial reporting has raised the necessity for a wide-ranging discussion about the harmonization of public sector accounting systems. The article has a double aim: to show the adoption or not of IPSASs in local and central government and to analyse the level of convergence between the different countries studied. In order to achieve these objectives, we carried out an empirical study, whose results allow us to show that while some accounting systems are very close to the IPSASs model, others are completely different. Nevertheless, we think that this could be a starting point and that in the near future countries could tend towards IPSASs more and more, which may be the most probable way to reach convergence accounting systems between them.

The Determinants of Local Government's Financial Transparency

Abstract This paper contributes to the scarce literature on government transparency by analysing the impact of political and socio-economic factors on municipal financial transparency. Our sample covers the 100 largest Spanish municipalities in 2008. Compulsory publicity and transparency are key to public management (rule-of-law theory). Our data show that Spanish municipalities are providing financial information beyond the legal requirements, thus exceeding the compulsory disclosures required by the rule-of-law theory. The more taxes and more transfers per capita, the more financial information is disclosed and, accordingly, the higher the transparency is. Therefore the municipalities are not taking advantage of fiscal illusion or principal–agent effects, since they are not concealing higher levels of taxes and transfers from citizens. Furthermore, left-wing parties are more transparent than right-wing ones. Finally, the population also has a positive effect on the achievement of financial transparency.

Explaining differences in efficiency: an application to Spanish municipalities

This article, investigates efficiency in the municipal sector of the Region of Murcia (Spain). With that aim, data of 31 municipalities (69% of the response rate) have been collected. Services analysed are: police, culture, sports, green areas, refuse collection and water supply. Ratios of efficiency have been related to other control variables, such as economic level, size of the municipality, decentralization, political sign and financial situation. A weak positive relation between economic level and efficiency arises. Some weak evidence also exists that public management of refuse collection is more efficient than private. In water supply, public management by means of a company controlled by the local government is clearly more efficient than private. It also seems that the higher the tax burden, the greater the efficiency in providing services.

The determinants of the municipal debt policy in Spain

This paper analyzes the impact of economic, social and political factors on municipal debt behavior. With this aim, we have obtained a stratified random sample of 130 cities during a five-year period. These data have been used to configure a micro panel to obtain accurate estimates and to control for problems such as unobserved heterogeneity. The main conclusion obtained from this process is that non-financial surplus/deficit, financial independence, capital expenditures, and capital revenues are the variables that best explain the indebtedness of this type of entities.

Evaluación de la deuda pública local en España

RESUMEN En los últimos años se ha incrementado el interés por estudiar aspectos relacionados con la deuda pública. En este contexto, el presente trabajo pretende analizar las variables que mejor explican el endeudamiento en uno de los niveles en que se divide el sector público en España: el sector local. Para ello, empleamos una muestra formada por todos los ayuntamientos españoles que tienen más de 1.000 habitantes en el año 2008 (3.253), aplicando mínimos cuadrados en dos etapas. La principal conclusión a la que se ha llegado es que las variables que explican el endeudamiento municipal son heterogéneas. Por una parte, las variables de tipo socioeconómico (población, porcentaje de inmigrantes, nivel económico, transferencias e impuestos) afectan positivamente al nivel de deuda per cápita. Por otra parte, variables de tipo político, tales como la fortaleza política, nos indican que los gobiernos más débiles son los que tienen un menor nivel de deuda per cápita.

FACTORES EXPLICATIVOS DE LA PRESIÓN FISCAL MUNICIPAL

This paper evaluates the municipal fiscal burden (MFB) for the years 2001–2006. We focus on two theories: the partisan politics and political strength. The former posits that left parties require higher taxes. According to the latter, strong governments are able to apply fiscal adjustments in that interest groups cannot press on these governments. In addition, we relate the MFB with some socioeconomic and demographic factors, in agreement with the extant literature. The empirical results do not indicate that the political orientation of the municipal government impacts the fiscal burden. However, evidence is found in relation with the strength of the municipal government and the electoral year. As far as socioeconomic/demographic variables are concerned, the economic level, the unemployment rate and the immigration significantly and affect the tax burden. The two latter impact positively, while the former impacts positively on the MFB. The classification of municipalities according to population thresholds, which stems from the legal obligation to provide certain services, has an effect on the MFB. However, neither total population nor population density impact the MFB.

Financial reports and decentralization in municipal governments

Some reforms implemented in the Spanish municipal sector have led to an increasing managerial decentralization. This decentralization has made municipal financial statements lose relevance, since devolved entities are not disclosed in these statements. Accordingly, we have made an empirical analysis of 54 big Spanish municipalities in order to evaluate the impact of decentralization on the municipal financial statements. The survey shows a great concern among practitioners about the importance of global reports. Furthermore, devolved entities should be included in the global reports if the municipality has the authority to approve their budget. This feature shows a legal/budgetary bias of municipal officials, who focus on legal and budgetary constraints more than on managerial indicators. We think this bureaucratic approach should evolve to another one with a higher degree of private sector management techniques.

Determinants of Spanish regions' tourism performance: a two-stage, double-bootstrap data envelopment analysis.

Despite the current international financial crisis, the tourism sector has managed to maintain high levels of activity. Against a backdrop of weak demand and stiff competition, efficiency has come to the fore as a key issue, especially in consolidated markets, such as Spain, where hopes that the sector will lead the way to economic recovery contrast with statements from the Competitiveness Monitor of the World Travel & Tourism Council that Spain is losing its competitiveness. In this article, the two-stage Simar and Wilson procedure is used to estimate the effect of a group of nine environmental factors on robust data envelopment analysis (DEA) estimates which act as a proxy of destination competitiveness for the Spanish autonomous communities (or regions) between 2002 and 2010. A brief discussion in terms of D- and E-attraction and cluster D-attraction is also included. The article contributes to the destination industry literature by adopting an approach that has not hitherto been applied to Spain.

Creating Room for Manoeuvre: a Strategy to Generate Political Budget Cycles under Fiscal Rules

We examine the effect of a balanced budget rule on the local political budget cycle. Specifically, we pay attention to the evolution of budget deficit, taxes and capital spending around elections. Using a sample of the Spanish largest municipalities in 1994–2009, we find that the balanced budget rule has not dampened the political budget cycle in budget deficit. Therefore, our results indicate that although governments are constrained by such rule they engage in electoral‐induced fiscal manipulation. In non‐electoral years, they create room for manoeuvre to implement expansionary fiscal policies in electoral years. Specifically, there is saving in the pre‐electoral year and deficit increase in the electoral year. This has been achieved largely through tax and fee increases during the pre‐electoral year and by shifting the bulk of the capital spending increased from the pre‐electoral year to the election year. Furthermore, our findings indicate that the balanced budget rule has succeeded in limiting the budget deficit.

International Classification of Local Government Accounting Systems

In recent years most of the OECD countries have introduced important reforms in their public accounting systems, with the objective both of improving public service management and increasing the transparency and accountability of governments. In that context, we think that it could be interesting to study whether the changes and reforms have led to the convergence of local government accounting systems. We aim to show the real degree of uniformity/heterogeneity that currently exists among the countries considered in our sample and why differences persist nowadays even in the European Union countries, trying to classify countries into groups according to accounting practice. The study is based on a survey that we sent to governmental accounting academics and professionals in different countries. To classify the accounting systems we have used the cluster analysis technique, traditionally used in this type of study for the business sector. We have been able to observe that three clearly differentiated groups exist: the first one uses a cash basis; the second model, where most of the countries are European with a continental tradition, has a Chart of Accounts and uses a modified accrual basis; in the third model, which could be called Anglo-Saxon, an accrual basis is used and one of the main objectives is to provide information about economy, efficiency and effectiveness in the provision of public services.