Local government administration systems and local government accounting information needs: is there a mismatch?
| Published date | 01 December 2019 |
| Author | Sandra Cohen,Francesca Manes Rossi,Eugenio Caperchione,Isabel Brusca |
| Date | 01 December 2019 |
| DOI | 10.1177/0020852317748732 |
| Subject Matter | Articles |
Article
International
Review of
Administrative
Sciences
Local government
administration systems
and local government
accounting information
needs: is there a
mismatch?
Sandra Cohen
Athens University of Economics and Business, Greece
Francesca Manes Rossi
University of Salerno, Italy
Eugenio Caperchione
Modena and Reggio Emilia University, Italy
Isabel Brusca
University of Zaragoza, Spain
Abstract
After several years of reforms inspired by the New Public Management approach, public
sector accounting and performance measurement systems continue to differ among
countries. Based on previous literature and data collected through a questionnaire, we
perform an exploratory study on the relations between local government administra-
tive systems and local government accounting information needs in a sample of
European countries characterized by a legalistic orientation. Our results reveal that
there is a frequent mismatch between the needed accounting and performance mea-
surement information for internal and external purposes assessed on the basis of the
administrative system in place and the accounting information and performance
Corresponding author:
Sandra Cohen, Athens University of Economics and Business, Department of Business Administration, 76
Patission Street, Athens, Greece.
Email: scohen@aueb.gr
International Review of
Administrative Sciences
2019, Vol. 85(4) 708–725
!The Author(s) 2018
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DOI: 10.1177/0020852317748732
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measurement information required by the law for decision-making and accountability.
Moreover, as the results reveal, legislation in European local governments only sporad-
ically stipulates the information suitable to satisfy the information needs created by the
different levels of financial and organizational autonomy of local government adminis-
tration systems to be available.
Points for practitioners
In this article, we compare the accounting information and performance measurement
information required by the law for decision-making and accountability to the informa-
tion that we would expect to be available for internal and external purposes assessed
on the basis of the administrative systems in local governments in 11 (eleven) European
countries. Apart from the mismatches identified, our results provide evidence that the
accounting reforms towards accruals have been adopted without informing the systems
related to administration, accountability, everyday decisions and assessment from over-
sight authorities. Unless this situation changes, the limited use of accruals should come
as no surprise.
Keywords
accountability, accrual accounting, performance measurement, public administration
typology
Introduction
Despite the introduction of accrual accounting systems in governments and public
sector entities, cash or modified-cash information (Brusca et al., 2015; Reichard
and Van Helden, 2016) still plays a pivotal role in political decisions at both the
local and the national level (Heiling et al., 2013). Therefore, even though accrual
accounting provides a tool that can offer a plethora of information useful for
decision-making and control, not all local governments (LGs) exploit it as
decision-making is sometimes based on other forms of information (e.g. cash
information). Consequently, local administrators may not be interested in accrual
accounting information as their performance assessment is done on the basis of
other quantitative or qualitative measures (Van Helden et al., 2016). From this
perspective, the lack of demand for accrual accounting data could be explained by
the regulatory requirements of a country.
A large strand of public administration research has revealed that there are
several well-established typologies of European LG administration systems
(Heinelt et al., 2018; Hesse and Sharpe, 1991; Ladner et al., 2016; Loughlin,
2003). They are characterized by different considerations regarding, for example,
Cohen et al. 709
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