Public Sector Financial Statement Notes to Convergence with International Standards, Transparency, and Social Control

Abstract

The financial statement notes contribute to public accounts' transparency and the instrumentalization of social control, although they are frequently absent from public sector financial statements. In this context, this study's objective was to present the structure of notes to public sector financial statements, nonexistent until then, in the Brazilian setting, which would contribute to the improvement of this context. The structure was developed according to the recommendations in the wording of the Brazilian Accounting Standards. The results of this work provide public accountants with a reference structure of notes to public sector financial statements, contributing to a greater understanding and transparency of accounting rendering by users of accounting information, control bodies, and society

Quality of the Explanatory Notes of Brazilian Federal Professional Councils

“…In view of the need to improve public accountability, the instrumentalization of social control and the provision of financial and non-financial information to support decision-making by users of public sector financial statements, there is a need to improve the quality of the CFFPs' NEs. This study analyzed the level of quality of the explanatory notes of the CFFPs, in the 2021 financial year, using checklists adapted from Abreu and Bezerra Filho (2021), Beest et al (2009), Gabriel (2011) and Lourenç o and Francisco ( 2016). To answer the research question, we used data collected from the CFFPs' websites, as well as requests for information through institutional channels for access to information.…”

“…In a complementary way, Checklist II derives from the models built by Abreu and Bezerra Filho (2021), Beest et al (2009), Gabriel (2011) andLourenç o andFrancisco (2016), which makes them more adherent to the reality of these municipalities, considering that most of these authors did not use them in public entities, but in private sector companies.…”

“…Previous studies have observed information weaknesses in the first sector, marked by a lack of clarity, the use of jargon and an excess of information, which leads to a low level of understanding on the part of users in relation to the accounting information disclosed (Oliveira et al, 2018). Adequate use of NEs was one of the factors listed that could improve these reports (Oliveira et al, 2018;Abreu & Bezerra Filho, 2021). This research is therefore justified by the need to improve the level of quality of the explanatory notes reported by the public sector and aims to meet the global demand, raised by Herath (2017), regarding the development of ideal methods for assessing the quality of financial reports.…”