Fiscal Responsibility and Australian Commonwealth , State and Territory Government Budgets

The government sector in Australia has seen the introduction of accrual accounting principles in recent years. However, this process has been complicated by the presence of two alternative financial reporting frameworks in the form of a) the Government Finance Statistics (GFS) uniform framework and b) the accrual accounting rules specified in Australian professional accounting standards, principally AAS 31. While a variety of cash and accrual based measurements are available pursuant to these frameworks, there has been no prescription of the manner in which the alternative measures should be presented. This paper presents the findings from a case study of the 2005-06 annual budgets prepared by the Australian Commonwealth government and the governments of the six Australian States and the two Australian Territories. The study examined the headlined financial outcome (general government sector budget surplus or deficit) announced in the budget papers of the nine governments. Findings indicate the adoption of varying measurement bases and a consequent lack of inter-government comparability. A number of variations to the measurements prescribed in the accounting frameworks were also observed. The paper analyses these government budget surplus and deficit numbers in the context of fiscal responsibility, the Commonwealth government’s Charter of Budget Honesty and the AASB’s current GAAP/GFS Convergence project.Government budgets, Fiscal responsibility, Public sector accounting, Government Finance Statistics framework, GAAP/GFS convergence, Government surplus/deficit announcements

The first nine years of \u27accounting history\u27 : 1996 to 2004

This paper adds to the prior literature examining publishing patterns in the accounting history discipline by undertaking a content analysis of publications in the first nine years of the new series of the journal Accounting History. The paper commences by providing an historical background to the introduction of the new series of the journal and the journal\u27s editorial team. This is followed by an authorship analysis of the journal\u27s research publications. This analysis examines patterns of authorship (single and multi-authored papers), the journal\u27s most published authors, institutional and geographical affiliations of authors (including international collaboration and changes over the nine year period) and author gender.<br /

Australian Commonwealth, State and Territory Government Budgets and the Selective Announcement of Budget Surplus/Deficit Numbers

This paper presents the findings from a case study of the 2004-05 annual budgets prepared by the Australian Commonwealth government and the governments of the six Australian states and the two Australian territories. The study examined the headline financial outcome (general government sector surplus or deficit) announced in the budget papers of each of the nine governments. Findings indicate the adoption of varying measurement bases and a consequent lack of comparability in the headlined budget outcome numbers. Accounting reforms have resulted in a variety of cash and accrual based measurements becoming available for presentation by governments. However, there has been no prescription of the manner in which these alternative measures are to be presented, resulting in a lack of consistency and comparability. It is not surprising in this reporting environment that different governments would choose to headline different budget outcome numbers in their budget announcements.

Auditor independence : shared meaning between the demand and supply sides of the audit services market?

Purpose &ndash; The purpose of the paper is to examine the extent to which there is shared meaning of the concept of auditor independence between the three major groups of parties on the demand and supply sides of the audit services market &ndash; auditors, financial report preparers and financial report users.Design/methodology/approach &ndash; The paper utilises the measurement of meaning framework (semantic differential analysis) originally proposed by Osgood et al. in 1957. The framework is used to investigate the extent to which there is shared meaning (agreement in interpretations) of the independence concept, in response to alternative audit engagement case contexts, between key parties to the financial reporting communication process. The study\u27s research data was collected in the period March 2004-May 2005.Findings &ndash; Findings indicate a robust and stable single-factor cognitive structure within which the research participants interpret the connotative meaning of the auditor independence concept. An analysis of the experimental cases finds similarities in connotations (interpretations) of an audit firm\u27s independence for the participant groups for most cases, with the exception of cases involving the joint provision of audit and non-audit (taxation) services.Research limitations/implications &ndash; The usual external validity threat that applies to experimental research generally applies to the study. That is, the results may not be generalisable to settings beyond those examined in the study. An important implication of the study is that it emphasises the continuing problematic nature of the joint provision of audit and non-audit services, even in situations where the non-audit services comprise only traditional taxation services.Originality/value &ndash; The study is the first to examine the concept of auditor independence by means of the Osgood et al. measurement of meaning research framework using, as research participants, the three major groups on the demand and supply sides of the audit services market.<br /

Australian government budget balance numbers: the hybrid nature of public sector accrual accounting

Purpose - The purpose of this paper is to analyse the nature and comparability of budget balance (surplus/deficit) numbers headlined by the Australian Commonwealth Government and the governments of the six Australian States and the two Australian Territories. It does this in the context of the transition to Australian accounting standard AASB 1049 Whole of Government and General Government Sector Financial Reporting. Design/methodology/approach - A case study research method is adopted, based on a content/documentary analysis of the headline budget balance numbers in the general government sector budget statements of each of the nine governments for the eight financial years from 2004-2005 to 2011-2012. Findings - Findings indicate some variation in the measurement bases adopted and a number of departures from the measurement bases prescribed in the reporting frameworks, including AASB 1049. Findings also reveal that none of the nine governments have headlined a full accrual based budget balance number since the implementation of AASB 1049 in 2008. Research limitations/implications - While the study focuses on the Australian general government sector environment, it has significant implications in highlighting the ambiguity in the government budget balance numbers presented and the monitoring and information asymmetry problems that can arise. Research findings have wider relevance internationally in highlighting issues arising with the public sector adoption of accrual accounting. Practical implications - The paper highlights the manner in which governments have been selective in the manner in which they present important budget aggregates. This has important practical and social implications, as the budget balance number is one of the most important measures used to evaluate a government\u27s fiscal management and responsibility. Originality/value - The paper represents the first detailed examination of aspects of the effect of the transition to AASB 1049

Implications of the IFRS goodwill accounting treatment

Purpose &ndash; This paper aims to critically examine the change in accounting treatment for goodwill pursuant to international financial reporting standards (IFRSs) by reference to the Australian reporting regime.Design/methodology/approach &ndash; The paper discusses and compares the former Australian and the new IFRS treatments for goodwill. This comparison focuses on the advantages and potential complexities of the new method, with the aim of identifying the issues and challenges that preparers, independent auditors and those involved in corporate governance face in complying with the new requirements.Findings &ndash; The paper highlights that the identification and valuation of cash-generating units and goodwill require numerous assumptions to be made in estimating fair value, value in use and recoverable amount. Considerable ambiguity and subjectivity are inherent in the IFRS requirements.Research limitations/implications &ndash; Findings suggest that future research should examine how financial report preparers and corporate governance mechanisms are dealing with the complex change required by the new goodwill accounting treatment and how the many critical issues involved in auditing the resulting figures are being addressed.Practical implications &ndash; The research has practical implications for financial report preparers in identifying the issues that must be addressed in complying with the international goodwill accounting treatment. In turn, the paper highlights conceptual issues of relevance to auditors in their role of providing assurance on the resulting accounting numbers. It also has implications for others involved in corporate governance, such as audit committee members, in emphasising the areas in which they should be providing oversight of the accounting judgments. These issues are of relevance in any reporting regime based on IFRSs.Originality/value &ndash; While much has been written about the mechanics of the new goodwill accounting requirements, there has been a lack of critical research highlighting the many problems and ambiguities that will arise in the application of those rules.<br /

Behind the headlines : an analysis of Australian Commonwealth, State and Territory budget balance numbers

The introduction of accrual accounting principles for government reporting in recent years has been complicated by the presence of two alternative financial reporting frameworks, the Government Finance Statistics (GFS) framework and the Australian professional accounting standard rules. This paper presents the findings from a study of the 2004-05 and 2005-06 annual budgets prepared by the Australian Commonwealth government and the governments of the six Australian States and the two Australian Territories. The study examined the basis for the budget balance numbers (government surplus or deficit) headlined in the budgets of each of the nine governments over the two year period. Findings indicate the adoption of varying measurement bases and a resultant lack of inter-governmental and inter temporal comparability. A number of departures from the measurementsprescribed in the reporting frameworks were also observed.<br /