Public financial management (PFM) reforms will only be achieved through finance professionals with the right skills and knowledge.
Governments are implementing PFM reforms in a bid to improve the accountability, transparency, governance and integrity of revenues and spending. But many reforms have addressed structures, systems and processes rather than people and capabilities, according to ACCA and IFAC (the International Federation of Accountants).
A new joint ACCA/IFAC report – released at the World Congress of Accountants (WCOA) held in Mumbai, India, from November 18-21 – aims to boost PFM reforms across the globe.
A global guide for professionalisation in public-sector finance outlines what professionalisation means in public-sector finance, sets out the benefits of professionalisation, and offers a high-level roadmap to support global good practice in professionalisation.
Discussing the global guide ahead of a panel discussion at WCOA, Joseph Owolabi, ACCA president, said: "Professionalisation brings credibility, trust and confidence in public finances by supplementing the systems and public-finance processes with the right skills for accountability, transparency, good governance and external scrutiny.
"A professionalised workforce within a finance function supplies more than accounting information. It brings wide value to public-sector finances – providing improved revenue collection, effective budgetary controls, and the data required to support policy decision-making."
Kevin Dancey, IFAC CEO, said: "We are looking to rebalance the focus so that it is not only on the process, but also on the people. The value of the accountancy profession, whether in the public or private sectors, comes from the experience, skills, judgment and ethical behaviour of its people. By increasing the number of professional accountants working in the public sector, we will no doubt add to the credibility and effectiveness of PFM, and reinforce trust in public services and spending."
Achieving professionalisation brings multiple benefits to the economy, governments and individuals. It means greater financial credibility for economies, improved financial management discipline for governments, and greater access to diverse career options for individuals.
The report acknowledges that achieving professionalisation is not straightforward or easy. It requires political will, structures, adoption and implementation of complex policies, plus continuous development and improvement.
The report highlights case studies of good practice from Tanzania, the UK, Cyprus, the Philippines, Pakistan, Malaysia and Wales.
Alex Metcalfe, ACCA’s head of public sector, said: "Political leadership and commitment for professionalisation is the most important factor for sustaining PFM reforms over time.
"In some countries, there is a lack of recognition that change is needed at all. In other countries, PFM reforms have concentrated on moving from cash-based to accrual-based accounting. But now more effort is urgently required to professionalise public finance staff and provide opportunities for training for professional qualifications."