Development of Estonian local government accounting: the stages of evolution during the years 1991–2013

Constraints and stimuli in the implementation of public accounting reform: systematic literature review and future research agenda

“…Absence of internal control. In developed countries, the lack of internal control is identified as a constraint to the implementation of public accounting reform (Ada and Christiaens, 2017; Christiaens, 2001; Haldma and Kenk, 2014; Nakmahachalasint and Narktabtee, 2019). The study of Carvalho et al (2007) found that in Portuguese municipalities there is no legal entity to perform audits and that in fact the audits are carried out by the Court of Accounts and the General Financial Inspection authorities only to scrutinize legal form and fiscal regularity.…”

“…Eastern European countries including Bulgaria, Croatia, Slovakia and Slovenia appear to adopt the IPSAS more intensively, motivated by their wish to adhere to the EU. Finally, the harmonization process has been weak and partial in Italy, France and Spain due to inadequate harmonization among different levels of government, which was then reflected in external harmonization (Ada and Christiaens, 2018; Gomes et al , 2015; Haldma and Kenk, 2014).…”

“…The literature shows that local governments have largely perceived consolidated financial statements as a tool that they can use to provide a clearer picture of their efficiency and effectiveness in the use of public resources while improving their transparency and raising the public’s perception of their organizational conduct (Santis et al , 2019). In European countries such as Portugal (Gomes et al , 2015), Estonia (Haldma and Kenk, 2014), Hungary (Lentner et al , 2020) and Malta (Jones and Caruana, 2014) pressure from the central and local governments is seen as a stimulus in accounting reform through the adoption of the business accounting model to improve the economy and the efficiency and effectiveness of government operations.…”

“…This happened in Malta and it explains why a government would develop a new accounting system before deciding on the broader conceptual design features behind that new system (Caruana, 2017; Jones and Caruana, 2014; Kowalczyk and Caruana, 2022). In addition, Haldma and Kenk (2014) found that the public sector in Estonia saw the expanding NPM concept for improving the efficiency and effectiveness of the public sector based on better financial and non-financial information, as a significant incentive for accounting reform.…”

“…This can be found in the Flemish Government, where the mere involvement of consultants can be considered a significant factor positively affecting the level of compliance to the reform at different periods (Christiaens and van Peteghem, 2007). The study conducted by Haldma and Kenk (2014) revealed auditors’ requirements to be a stimulus for governmental accounting reform, as they substantially improved the accounting procedures in Estonian local governments moving toward the accrual basis and business accounting, and supported the formation and delivery of fairer and more reliable financial information (Christensen, 2002).…”