Public Sector Financial Management Reform (PSFMR) and International Accounting Standards (IPSASs)

Abstract

The socioeconomic ambition of government and the dwindling nature of revenue sources coupled with financial/debt crisis across the globe raised serious concern among governments, especially the developing nations. Nigeria, just like other developing countries had been characterised with poor financial management system that paved way for mismanagement of resources and solidification of corrupt practices among government ministries, departments, and agencies’ officials that are frontline government institutions. The effect of government financial decisions has been felt badly by the citizens over decades as it is evident in the economic hardship and dilapidated public infrastructure and poor social welfare services. To address these myriad problems, government must seek reformation and restructuring of public financial management system to enable efficient and effective delivery of public services. In a bid to encourage the transformation agenda of the Nigerian government, this paper identified and discussed some of the ongoing public financial management reforms under the platform of IPSAS in achieving the reform objectives. In particular, the study largely adopted the qualitative research approach through careful review of literatures and guidelines. The study posits that implementation of IPSAS accrual accounting is a key reform strategy in improving the public sector financial management system. Implementation of accrual accounting will definitely result to higher transparency and improve the quality of public sector financial reports. Therefore, the study concludes that strong political commitment is a key driver for the reform.