BOOK REVIEWS
| Published date | 01 December 1953 |
| DOI | http://doi.org/10.1111/j.1467-9299.1953.tb01716.x |
| Date | 01 December 1953 |
BOOK
REVIEWS
Government Accounting and Budget Execution
UNITED
NATIONS and
H.M.S.O., 1953.
Pp. v
-I-
90.
5s.
THIS
publication contains the results of a
study carried out at the request of the
Economic and Social Council of the
United Nations by the Fiscal Division of
the Department of Economic Affairs in
the United Nations.
It
is divided into
two
parts. The kst
is
of general applica-
tion and surveys the broad requirements
for
an
adequate system of central govern-
ment accounting.
The terminology used does not conduce
to ready appreciation by the British
reader, who may find it difficult to know
exactly what is meant by such a sentence
as
:
“
The techniques of budget execution
provide a means of strengthening a central
government in the administration of
programmes for stability and develop-
ment.” The term
“
budget execution
”
which occurs constantly is not familiar
to
us.
Apparently it means in our
phraseology something like the relation
of expenditure to estimates as approved
in
the
Appropriation Acts.
The general conclusion reached is that
while no uniform system of government
accounting can be recommended for all
countries, every country would be well
advised
to
carry out a periodic re-exam-
ination of its system in order to determine
its adequacy and the ways in which it
should be adapted to meet changing
requirements. Very often procedures
have become cumbersome and out of date.
In Great Britain this is
a
point which is
constantly being examined by the Public
Accounts Committee
of
the House of
Commons; moreover the whole form of
Government Accounts was reviewed
recently by a Committee under the
chairmanship of Mr.
W.
F.
Crick, which
produced its report in
1950
(Cmd.
7969),
but found
no
changes of principle
necessary.
The authors also recommend that
external
pre-audit
control
should
be
diminatcd
and
rculaccd
bt
witiiy
inrrrnal
c;ontrol
undcr
thr
wneruition
nf
rha
Post-audit
by
an
external
auditor
should
Hcad
of
cach
Departmcnt
of
Government.
provide the legislature with an authoritative
analysis of the custodianship of public
funds. This is the system which has
been in operation in Great Britain for
many years; though it is generally
recognised here as the best system, it is
satisfactory to find it endorsed and recom-
mended to other countries by the experts
of the United Nations.
The Study mentions very briefly the
British system of entrusting the examina-
tion of Government Accounts and the
auditor’s reports thereon to a special
Committee of Parliament,
known
as the
Public Accounts Committee. Few
countries outside the Commonwealth have
a system of this sort, but it provides a
vital link in Parliamentary control of
expenditure and it is to be regretted that
the authors do not describe our system
in more detail and commend its wider
adoption.
The Report recognises that there are
necessarily wide variations in the form
and scope of post-audit-from the detailed
examination
of
every transaction to what
it describes as
“
modern sampling tech-
niques
”
under which
“
the post-audit
becomes more an audit of the accounting
system
.
. .
than an audit of its rransac-
tions.” The magnitude of Governmental
expenditure in all countries under modern
conditions and the need for restricting the
cost of audit within reasonable bounds
undoubtedly demand a system
of
tests
rather than a
100
per cent. check, and
our
Parliament recognised this as long ago as
1921.
But an examination of any system
must depend primarily on a scrutiny of
its transactions, and it would be a sad
day if auditors felt that they could perform
their duties merely by looking into the
system of accounting without making
sufficient test checks of actual transactions
to enable them to judge whether the
qystem
adequately meets
current
needs
mrl
IP
pmpeFly
applied
audit
may
assume
a
substantive character
-an examination
of
the effectivsnsss
of
ThP
XfI~dy
My8
hgtirlkee
Chnl
“Post
123
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