International Public Sector Conference 2019: papers

Here we present the three successful papers submitted for the ACCA International Public Sector Conference 2019.

Paper 1: What accounting standards should be used for public organizations? Emerging frameworks and practices among Italian public care providers

Authors: Alessandro Lombrano, Silvia Iacuzzi, Andrea Garlatti (University of Udine)


The financial pressures of the last decades and the requests for modernization of the public sector have often resulted in an increased focus on performance information and in the adoption of new accounting techniques, such as cost and accrual accounting. These new frameworks and standards can supplement or replace more traditional cash- and commitment-based budgetary accounting systems.

In some instances, public organizations were given the choice to adopt a harmonized system or to leap-frog to pure accrual accounting. This article explores what is advisable according to current regulations and financial managers for Italian public care providers.

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Paper 2: Carillion's collapse and the future of PFI

Authors: Dr Aminah Abdullah, Senior Lecturer in Accounting, University of Roehampton, London. Professor Iqbal Khadaroo, Head of Accounting Subject Group, University of Sussex, Brighton.


An analysis of past corporate failures reveals that many of their causes are common across industries and countries (Hamilton and Micklethwait 2006). Carillion's rise to glory and spectacular downfall, reminiscent of Enron's, were attributable to reckless expansion, hubris and greed (House of Commons 2018). This article draws on data from published sources (ie Carillion’s annual reports, press releases and parliamentary proceedings) to examine the causes and consequences of Carillion’s collapse and the future of the Private Finance Initiative (PFI) policy.

Understanding the collapse of Carillion is important because:

  • the collapse will cost taxpayers about £150m, as a large number of contracts between Carillion and the public sector need to be resolved and rescued
  • it left a pension deficit of over £800m for workers, over £1bn of bank debts and over £2bn of trade debts (Ellison 2018; Carillion 2017), although stable dividends had been paid to shareholders and a generous executive compensation package for directors had been maintained, and
  • the fact that risks transferred to the private sector can revert back to the public sector leads to the questioning of the notion of risk transfer and value for money in PFI contracts.

Prior to its collapse, Carillion, with 43,000 employees, was UK's second-largest construction and facilities management company, and had a large number of contracts providing essential public services across government departments, such as the NHS, defence, education, energy, and prisons. It collapsed following financial hits from PFI deals. Carillion has left behind a number of partly finished PFI contracts and created uncertainties about the provision of public services, thus forcing the government to intervene. Moreover, Carillion's collapse has called into question the role of accounting, pension and government regulators in promoting good corporate governance.

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Paper 3: What influences disclosure choice in EU Supreme Audit Institutions' performance audit annual reports?

Authors: Adriana Tudor-Tiron, Roxana Moldovan-Romain, (Babes-Bolyai University, Faculty of Economics and Business Administration, Cluj-Napoca, Romania)

Introduction [abridged]

The importance of governmental political and economic decisions has increased following the 2007 financial crisis. Stakeholders need information that confirms whether government funds have been spent correctly and in accordance with regulations. They want to know the extent to which public organizations have achieved their performance objectives. This is a task of potentially great significance at a practical level for citizens, and at a more abstract level for the health and vitality of democratic governance (Pollitt, 1999). The Performance Audit (PA) is one of a number of public reform tools introduced with the objective of increasing the credibility and accountability of the public sector.

PA in public sector is carried out by national Supreme Audit Institutions (SAIs), and involves an independent examination of the efficiency and effectiveness of government undertakings, programs or organizations, with due regard to economy, and the aim of leading to improvements. PA enables governments to demonstrate to the public whether they have fulfilled their responsibilities and been accountable with regard to resources. In order to assess efficiency it is necessary for economic, efficient and effective gains to be measurable (Stroobants & Bouckaert, 2012).

This article gives an overview of the EU SAIs' disclosure of their PA activity as a tool to increase SAI's transparency and accountability. It examines Annual Activity Reports (AARs) that are publicly available on websites, in either English or French, from November 2014 to May 2018. This period begins with the 2013 AAR, the year when ISSAI 300: Fundamental Principles of Performance Auditing was approved.

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