June Pallot

Elements of a Theoretical Framework for Public Sector Accounting

Suggests a notion of community assets based on common property that recognizes the fundamental importance of accountability and democratic control over resources in the public sector, the sociopolitical nature of accounting, and the need to give visibility to public as well as private interests. The development of such a concept has immediate effects on the way the accounting entity and the relationship between government and society are viewed and may even have ramifications for accounting in the “private” sector.

A Decade in Review: New Zealand’s Experience with Resource Accounting and Budgeting

Ten years before the United Kingdom introduced RAB a similar regime had been introduced in New Zealand. What evidence is there, then, that the experience with RAB has lived up to the promises made of it? While the speed with which RAB was introduced in New Zealand may make it appear easy, there were a number of theoretical and practical accounting and auditing issues involved in pioneering these developments. This paper explains how these difficulties were overcome, the benefits achieved, the outstanding issues to be resolved, and some new directions currently being proposed.

Infrastructure Accounting for Local Authorities: Technical Management and Political Context

Internationally, there has been mounting interest in the subject of accounting for infrastructure assets and their deterioration. In New Zealand, the adoption of full accrual accounting across the public sector from 1989 has meant that local authorities have been grappling for some time with the problem of how best to account for these assets in a manner which is relevant for both managers and elected representatives. This paper reviews methods of accounting for infrastructure in New Zealand local authorities, and explores how infrastructure assets and related expenses might be accounted for in a manner which is consistent with both the New Zealand accounting profession’s conceptual framework and the requirements of democratic decision making over the allocation of resources.

Linking strategy and performance: Developments in the New Zealand public sector

In recent decades, many governments have sought to improve their systems of strategic management and priority setting. Few of these attempts have met with unequivocal success. In particular, the systems for “whole-of-government strategizing” have not been well integrated into the ongoing budgetary processes and departmental performance management systems. In 1993-1994, as part of its comprehensive reforms of the public sector, the New Zealand government instituted a new system of strategic management. The new approach-which in part grew out of the National governments attempt to outline its long-term vision in a document titled Path to 2010-involves the ministers specifying a series of medium-term policy goals, referred to as “strategic result areas” (SRAs), and then translating these into more detailed departmental objectives, known as “key result areas” (KRAs). More specific “milestones” are subsequently identified to serve as benchmarks against which the achievement of departmental KRAs can be assessed. This article describes and evaluates this new approach and considers its possible application in other countries.

Fiscal (ir)responsibility: privileging PPPs in New Zealand

This article explains the structures and rules built into the New Zealand government’s financial management system which encourage entry into commitments such as public private partnerships. That the system provides a means of escape from the tight constraints imposed by fiscal targets, and escapes public and parliamentary scrutiny in the process, seems at odds with espoused objectives of fiscal responsibility, debt reduction and transparency. In terms of furthering a privatization agenda, however, it is highly logical.

Transparency in Local Government: Antipodean Initiatives

Over the last decade, significant accounting reforms have been considered by a wide range of state and local governments throughout the world. Few countries have undertaken such extensive reform of their public sector, or of their public sector accounting practices as an integral part of those reforms, as New Zealand. While the central government accounting reforms are more well known, the reforms at local government have been equally dramatic, the most recent being the introduction in 1998 of a long-term financial planning regime under the Local Government Amendment (No. 3) Act 1996. This paper examines the factors leading up to the legislation, describes the requirements of the new regime, identifies the accounting and related issues which have arisen and concludes with some lessons which other countries may wish to consider in their own quest for transparency and accountability.

New public management reform in New Zealand: The collective strategy phase

Abstract This paper examines the New Public Management movement in New Zealand. Specifically the focus is on the financial management of central government departments and the shift in emphasis from management in the public sector to management of the public sector, that is, from defining management in terms of where it takes place to defining it in terms of the nature and outcome of the task.

Has Devolution Increased Democratic Accountability

This article examines the impact of devolution, the New Public Management and public management culture on accounting for democratic accountability in the first term of the devolved national assemblies and parliament in the UK. Although there is more openness, transparency, consultation and scrutiny with regard to budgets, accounts and performance as a result of devolution, there is extensive information overload. Thus, many politicians are highly dependent on the parliamentary division of labour and are reliant on experts and advisors functioning as buffers and filters of accounting information.

New Zealand's Financial Management System: Implications for Democracy

New Zealands new public management (NPM) financial management reforms were widely hailed as ground-breaking. This article explains how some of the accounting techniques used in New Zealands reforms undermine fundamental democratic controls. In the light of the evidence presented, other countries might review their own constitutional conventions and examine closely the extent to which the accounting techniques adopted and developed in financial management reforms enhance or undermine the fundamental mechanisms of democracy.

Service Delivery: The Audit Dimension

Reporting of performance information on public sector services has increased substantially in recent years. The audit of such information, however, is still relatively uncommon. In 1989 the Audit Office in New Zealand was confronted with a legislative requirement to audit Statements of Service Performance (SSPs). This paper backgrounds New Zealand’s shift in emphasis from program effectiveness audits to the audit of non-financial performance information, describes the development of audit methodology in this area and identifies lessons learned.