The country chapters in this study have dealt with financial accountability and management in government from the time funds are budgeted to the final published accounts. The SAIs involved have long recognised that the steady growth of public sector activities and spending by governments have generated the need for more efficient management of resources, better internal controls and appropriate financial reporting and disclosure to ensure proper accountability. Accordingly efforts towards improving financial management in government, particularly in budgeting and accounting, have been both positive and ongoing.
A paper presented at the first ASOSAI International Seminar held in Seoul in 1982 discussed certain theoretical aspects of national and economic development. It was suggested that countries progress through identifiable stages in the development process. During the first stage-the maintenance stage-governments are usually engaged in the early steps of nation building where investments and technology are limited and the budget system is object-orientated (line item). In the second stage of resources mobilisation, there is a take-off into economic growth, characterised by major investments by government and increased import of technology, with budgets being more target-oriented national resources budgets. When governments reach the third stage (guidance stage), there is a trend towards encouraging private sector participation in major government investments. Here the budgets take the form of cost / efficiency-oriented performance budgets. In the fourth and final coordination state, the governemnt focus is on industrialisation and greater privatisation, while the budget is output / delivery-oriented (involving program and performance budgets, management by objectives, zero based budgeting). Although these stages of development are not as clear- cut as theorists might suggest, clear trends are discernible in the country profiles examined in the present study.
Without exception, all countries reviewed have explicit statutory provisions governing finance, budgeting, accounting and audit. No major differences in concepts were observed although some variances in practices and procedures occur due mainly to different governmental frameworks and legislative provisions. The structure and format of these institutions in Commonwealth countries, however, are generally similar.
Basically accountability in the various countries is discharged by a system of legislative controls, administrative controls and control by the SAIs. Reports by the SAI to the legislature completes the accountability cycle.
All countries reviewed have parliamentary systems of government and financial control over the raising and disbursement of funds, which are entrenched in statutory provisions. Governments implement these broad principles by imposing detailed controls through subsidiary legislation, central agency rules and regulations, and administrative mechanisms such as internal audit and audit committees. In all the countries the SAIs examine executive compliance with statutory requirements, assess the performance of government activities, and evaluating their propriety in managing public funds and reporting the results to the legislature. These reports are then examined by relevant legislatural committees.
The laws governing financial matters and financial procedures seem to have common beginnings. However, with the passage of time, noticeable changes have taken place, particularly in budgeting in the various countries. As the traditional line-item budgets have become anachronistic, various performance-oriented budget systems have been implemented and modified in accordance with specific and emerging needs. Those countries such as India, which are still investing funds in socio-economic programmes, have separate budgets for development expenditure and for operating expenditure. Countries such as Australia follow continuous budgeting by means of a system of forward estimates, while Japan employs a single fiscal year system incorporating long-term projects.
In the countries reviewed, accounting and monitoring are the prerogative of the executive. Accordingly, the related systems reflect formal legislative and professional structuring. Commonwealth countries have inherited a "consolidated fund" system while some of the other countries maintain a system of general and special accounts. All countries keep their accounts on a cash basis although some are now looking closely at the accrual system of accounting. Further, accounting standards are the responsibility of the ministries of finance and are usually embodied in the applicable rules, regulations and instructions.
The national accounts themselves are at various stages of sophistication and effectiveness. Most are computerised and are either compiled at agency level or are centralised using microcomputers or mainframes, depending on the volume of transactions and complexity of the data required. The published accounts, without exception, aim at providing meaningful information and adequate disclosure. Further, as the accounts are required to be tabled in the legislature, parliamentary scrutiny is involved.
The Supreme Audit Institutions of the countries reviewed have their mandates prescribed in law. Their functions include examining the operations and activities of governments from both a regulatory as well as a performance-oriented perspective. They are independent of the executive and report directly or through the Cabinet to the legislature. In all countries reviewed, there are legislatural committees which review SAI reports, many of the committees being empowered to enquire into accounting matters referred to them by the legislature or other agencies of the government concerned.
The present study confirms that efficiency in the planning, control, and use of funds are the foundation of financial accountability and management in government. It underscores effective budgeting, accounting and auditing practices and procedures. Since its establishment in 1979, ASOSAI has mobilised thought and opinion in these matters, spending considerable funds to publicise and promote public sector efficiency. In recognising the role of skills and expertise in efficient administration, the thrust of ASOSAI directions has been towards staff training and development.
Accordingly the last decade has seen the proliferation of ASOSAI training programmes in the three broad areas of central government, public enterprise and local government, covering diverse topics such as revenue collection procedures, audit of development projects, computerisation, budgeting, accounting and other specialisations.
Although much emphasis has been placed on training and re-training auditors, over the years ASOSAI seminars have concentrated on problems pertaining to the nature of financial management and accountability in the public sector and the resolution of these problems through the role of the SAI. In particular, the Tokyo Declaration of 1985 addressed these problems of public accountability and how the executive and SAIs could promote public accountability. Further, the Bali Declaration of 1988 came up with recommendations on the role of the public sector auditing function in promoting effective public administration and corporate management. However, the successive "Declarations" emanating from ASOSAI International Seminars have not just been pronouncements. In addition, positive contributions have been made through research projects. The first of these, "Accountability and Control of Public Enterprises", covering twenty-one countries, was published in 1989. The present publication,-the second research project-covers financial management in eleven countries. In both these publications, the overall objective has been to document developments in government accounting and public finance in ASOSAI member countries which will serve as source material and data base for a wide range of users.