How to Profit from Defence: A Study in the Misapplication of Business Accounting to the Public Sector in Australia

24 Pages Posted: 26 Jul 2004

See all articles by Allan D. Barton

Allan D. Barton

Australian National University (ANU) - School of Business and Information Management

Abstract

The financial statements of the Australian Department of Defence portray it as a highly profitable business which sells defence services to the Government, earns a large profit, pays a substantial dividend and is largely self-funding. It is argued that the statements seriously misrepresent the financial performance and position of the Department. It is funded from a budget appropriation to provide defence services to the nation, but it is required to report as if it were a commercial business under New Public Management reforms adopted by the Government. But Government accounting systems must be adapted to their unique operating environments if their financial statements are to faithfully represent their financial results.

JEL Classification: M41, M47, H56, H57

Suggested Citation

Barton, Allan D., How to Profit from Defence: A Study in the Misapplication of Business Accounting to the Public Sector in Australia. Financial Accountability & Management, Vol. 20, No. 3, pp. 281-304, August 2004. Available at SSRN: https://ssrn.com/abstract=567482

Allan D. Barton (Contact Author)

Australian National University (ANU) - School of Business and Information Management ( email )

Canberra, Australian Capital Territory 0200
Australia

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