Annual Reporting and Accountability by Municipalities in Canada: An Empirical Investigation*

Abstract

Prior research regarding reporting and accountability by local governments in several countries has questioned the value of traditional annual reporting and the level of accountability to the public. This article reports on comparable research for local governments throughout Canada. The disclosure index methodology is used to evaluate the quality and quantity of information published in the annual reports and in the financial statements of Canadian local governments in 2003 with a comparison in 2005. Although all municipalities published audited financial statements, less than one-third of municipalities published a comprehensive annual report in 2003. The results show an overall low disclosure index with significant improvements in 2005 compared to 2003 and significant differences across the country. The results, largely consistent with previously published international studies, raise questions about local government accountability and about the conceptual framework for local government reporting. RAPPORT ANNUEL ET REDDITION DE COMPTES DES MUNICIPALITÉS CANADIENNES : UNE ÉTUDE EMPIRIQUE RÉSUMÉLes e´tudes pre´ce´dentes portant sur la reddition de comptes des administrations locales de plusieurs pays et sur les informations qu'elles publient ont remis en question la valeur des rapports annuels traditionnels et du niveau de reddition de comptes a`la collectivite´. Les auteurs font e´tat de donne´es comparables pour les administrations locales de l'ensemble du Canada. Ils appliquent la me´thodologie de l'indice d'information pour e´valuer la qualite´et la quantite´des informations publie´es dans les rapports annuels et les e´tats financiers des administrations locales canadiennes en 2003 comparativement a`2005. Bien que toutes les municipalite´s aient publie´des e´tats financiers audite´s, moins du tiers des municipalite´s ont * We gratefully acknowledge financial support from CGA-Canada and helpful guidance and comments from two anonymous reviewers.

Disclosure Quality Measurement in the Public Sector: A Structured Literature Review

“…Lynch, 2010;Schneider & Samkin, 2008), followed by the US/Canada with 9 (e.g., Blanco, Lennard, & Lamontagne, 2011;Fischer, Gordon, & Kraut, 2010). Compared with other regions, Europe as a research site is less investigated with only seven articles (e.g.…”

“…Seven articles considered one or more sections of the annual report (Allini et al, 2016;Blanco et al, 2011;de Deus & de Mendonça, 2015;Fischer et al, 2010;Guo, Fink, & Frank, 2009;Kaur & Arora, 2013;Robbins & Austin, 1986); while three papers concern specific issues such as disclosure regarding single financial statements' items (Bunget, Blidisel, Feleaga, & Popa, 2014;Giroux, 1989;Vermeer, Styles, & Patton, 2012). Five of these studies (Allini et al, 2016;de Deus & de Mendonça, 2015;Kaur & Arora, 2013;Robbins & Austin, 1986; ijbm.ccsenet.org…”

“…Blanco et al, 2011;Sahel et al, 2015). However, closing the gap between academic research on DQ measurement in the public sector and the accounting profession/practitioners is needed because, as Guthrie, Burrit, and Evans (2011, p. 9) argue, "There needs to be more communication and coordination between practitioners, policy makers and academic researchers" in general.…”

Extent of Disclosure in the Annual Reports of Malaysian Federal Statutory Bodies

“…Few studies focused on accountability disclosures in other settings. Among these few were Ryan et al (2002) and Blanco et al (2011) who studied Australian and Canadian local governments' annual reports respectively. Herawaty and Hoque (2007) focused on Australian governmental departments.…”

“…Blanco et al (2011) and Banks et al (1997) reported an overall low disclosure index on information published in the annual reports of Canadian local governments and universities in England, Wales, and Northern Ireland, respectively. More specifically, certain disclosure areas such as human resources and asset management showed low levels of disclosure, as reported by Herawaty and Hoque (2007) and Schneider and Samkin (2008).…”