Accrual Accounting in EU Local Governments: One Method, Several Approaches

Abstract

This paper seeks to measure the degree of accrual implementation in EU local government accounting systems and also tries to give an answer to the question of why accrual accounting has overcome the resistance to other New Public Management (NPM) reforms in countries relatively suspicious of them. We carry out our analysis through the comparison of the accrual accounting legal requirements in force in each country, and the published financial statements, taking the IPSASs of the IFAC as a benchmark. The results show different degrees of accrual accounting implementation and legal compliance. The reason of accrual accounting dissemination lies partially in that the dual systems implemented in European Continental countries do not require the introduction of deep organizational changes and answer the democratic demands of citizens for higher responsiveness, transparency and accountability, while traditional budgetary statements are maintained for monitoring compliance with legality and for administrative decision-making purposes.

EPSAS and the Unification of Public Sector Accounting Across Europe

“…Many public accounting scholars highlighted the fundamental difficulties generated by the adoption of accrual accounting (Adam, Mussari, & Jones, 2011;Barton, 2009;Biondi, 2012;Guthrie, 1998;Lapsley et al, 2009;Pina, Torres, & Yetano, 2009) as well as the practical difficulties of public administrations to effectively implement and/or utilize accrual accounting information in decisionmaking processes (Torres, Matsuo, & Pina, 2009). There had only been limited evidence available on the effectiveness of these systems so far.…”

Performance Management of IT in Public Administrations: A Literature Review on Driving Forces, Barriers and Influencing Factors

“…There is a great number of driving forces, like creation of transpareny [11,12,14,20,[22][23][24]26] or improvement of decision-making [15][16][17][18][19][20][21][22][23][24][25][26]. These driving forces face a huge number of barriers regarding the implementation and use of IT PM concepts.…”

“…We found that IT PM is mostly implemented in order to support decision-making [15][16][17][18][19][20][21][22][23][24][25][26], to create transparency [11,12,14,20,[22][23][24]26] as well as to improve accountability [7, 12, 16, 19, 21, 24-28, 37, 38], effectivity [20,22,26,27,[29][30][31] and efficiency [20,22,[26][27][28][29][30][31]. It should contribute to make public administrations more managerial and to make the IT usage more transparent and homogenous.…”

“…All these influencing factorsexcept for the political level -can be found in the private sector [54]. General influencing factors  culture of an organization [20]  availability of a cultural change [28]  size of an organization [33]  organizational form [9]  performance of an organization [33]  political environment [23,26,54] 4 Discussion Fig. 1 summarizes the identified driving forces, barriers and influencing factors concerning the implementation and use of IT PM.…”

“…The driving forces for the implementation and use of IT PM can be classified into driving forces which are related to the internal management and those which come from requirements from outside (Table 2). [18,22]  improvement of efficiency [20,22,[26][27][28][29][30][31]]  improvement of effectivity [20,22,26,27,[29][30][31]]  motivation of employees [11]  ability to identify trends [29]  creation of transparency [11,12,14,20,[22][23][24]26 [11,23,25,31] These driving forces face several barriers which hamper and complicate the successful implementation and use of IT PM. The barriers have been analyzed if they affect the implementation, the use or both ( Table 3).…”