Financial Sustainability, Accounting and Society

33 Pages Posted: 3 May 2011 Last revised: 22 Jan 2015

See all articles by Paul J. M. Klumpes

Paul J. M. Klumpes

Nottingham Trent University

Martin McKee

London School of Hygiene and Tropical Medicine

Rifat A. Atun

Imperial College London

Liyan Tang

affiliation not provided to SSRN

Date Written: August 7, 2013


This paper develops the concept of generational imbalance within a broader framework of financial sustainability in the public sector, by evaluating the inter-generational financial dimensions and management performance and control implications of long-term societal demographic trends. We argue that a financial sustainability framework identifies material generational accounting imbalances that will empower stakeholders to better evaluate the currently hidden inequities and resource allocation problems afflicting organizations whose services, funding and resource allocations are particularly sensitive to the effects of long-term societal demographic shifts. Our analysis focuses on reporting practices of two UK health-care provider trusts, developing statements of financial sustainability and comparing performance measures based on the existing accrual measurement basis with our proposed framework. We propose an alternative conceptual framework to the currently adopted resource accounting model in order to more equitably evaluate the long term financial sustainability of public sector entities subject to financial sustainability constraints in their quality of service delivery; and identify an agenda for research which can usefully further apply the proposed framework to other contexts.

Keywords: Financial sustainability, health care trust, under funding practices

JEL Classification: M41, L31, J18, H55

Suggested Citation

Klumpes, Paul J.M. and McKee, Martin and Atun, Rifat A. and Tang, Liyan, Financial Sustainability, Accounting and Society (August 7, 2013). Available at SSRN: or

Paul J.M. Klumpes (Contact Author)

Nottingham Trent University ( email )

Burton Street
Nottingham NG1 4BU, NG1 4LN
United Kingdom

Martin McKee

London School of Hygiene and Tropical Medicine ( email )

Keppel Street
Health Services Research Unit Professor of European Public Health
London WC1E 7HT
United Kingdom
+44 20 7-927 2229 (Phone)
+44 20 7-580 8183 (Fax)

Rifat A. Atun

Imperial College London ( email )

South Kensington Campus
London, DC SW7 2AZ
United Kingdom


Liyan Tang

affiliation not provided to SSRN

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