The HM 'Treasure's Island': A Theoretical Analysis of Central Government Accounting Standards in UK
Accounting in Europe, 2016. DOI:10.1080/17449480.2016.1142096
14th Biennial CIGAR Conference, Birmingham University, September 2-3, 2013
XVIII IRSPM Conference on 'Public Sector Responses to Global Crisis,' International Research Society of Public Management (IRSPM), Prague, April 10-12, 2013
19 Pages Posted: 8 Jan 2013 Last revised: 16 Feb 2016
Date Written: January 8, 2013
Since the nineties, UK has been progressively adopting a Governmental accounting reform purporting to interpret and mimic accounting standards and practices from the private sector. Since 2009, the UK set of accounting standards applicable to the whole of central government entities is based upon the international accounting standards (IFRS) initially designed for commercial enterprises, the latter standards having extensively inspired the International Public Sector Accounting Standards (IPSAS). This article summarizes the main pattern of this English accounting reform and analyses some theoretical and practical concerns raised by its application of a fair value accounting model to the public administration. Among others, these concerns are illustrated by the case of public private partnerships (PPP, PFI) that have been held off balance sheet (eluding then accounting and budgetary controls) notwithstanding their material impact on English public deficit and debt. The paper drives then relevant considerations and implications for representation and control of public deficit and debt in UK and in general.
Keywords: public accountability, accruals and cash basis accounting, non-business accounting and economics, governmental accounting theory and standards, UK, nature and role of the non business entity, IPSAS, IFRS, PPP, PFI
JEL Classification: D73, E62, H61, M40
Suggested Citation: Suggested Citation
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By Yuri Biondi
By Yuri Biondi