p15-opinion-market-street-zimbabwe-alamy-frx2xa.jpg

Harare, Zimbabwe: accountants and their professional organisations can help to support strong economic growth. Photo: Alamy

The desire to combat hunger, provide clean water and fight poverty is felt by most citizens. But few realise solving these problems and providing public services require governments to have sound public financial management (PFM) systems.

When a government bases spending decisions on inadequate financial information, the results can be disastrous: poor services, erosion of trust and economic instability. Sound PFM supports accountability and efficiency in how resources are managed and services delivered, and can increase foreign direct investment.

Poor PFM also enables fraud and corruption, which affect the poorest people the most. A United Nations panel estimates that illicit outflows in Africa could account for $50bn a year – nearly double Africa’s development assistance.

Strong PFM also supports the UN’s Sustainable Development Goals, particularly goal nine on resilient infrastructure.

Given that PFM’s importance is recognised by governments and those in international development, the accountancy profession needs to grow its capacity to fully support a strong, effective public sector, especially in emerging economies.

Professional accountancy organisations (PAOs) are the best means of boosting the quantity and the quality of accountants, but many require support. The profession is developing PAO capacity so accountants can be full partners in ensuring governments have sound PFM systems.

The International Federation of Accountants is working with its members, including CIPFA, to raise awareness and gain support for the changes needed to strengthen PFM.

This drive for change has been formalised in the Accountability. Now. campaign. This advocates for accruals-based information that captures all funding commitments. It also highlights that good information facilitates wise spending, strengthens economies and builds trust among citizens.

Building trust and integrity at the heart of the global economy is the subject of IFAC’s G20 submission and a #BuildTrust social media campaign.

IFAC has also held conferences and workshops for government officials and accountancy leaders to drive change globally. Last October in Senegal, we held PFM reform workshops for West African governments and accountancy leaders, which sped up reforms. These events helped to unite the public sector and the profession.

Through its Mosaic agreement, IFAC and donors focus efforts on key areas. Mosaic lays the foundation for an aligned approach to increase PAO capacity and improve financial management systems in emerging economies. IFAC is using funding from the UK Department for International Development (a Mosaic signatory), to strengthen PAOs in at least 10 DFID focal countries.

One project this funding supports is a partnership in Zimbabwe between CIPFA, the Institute of Chartered Accountants of Zimbabwe, and the Public Accountants and Auditors Board, Zimbabwe, to improve the profession’s ability to support the country’s public sector. This project is supported by Zimbabwean government leaders. Other projects, such as one in Uganda, include a public sector element, and we are assessing the feasibility of a pilot scheme for foundational accountancy skills in the public and private sectors.

The role of accountants and PAOs in supporting strong economic growth and PFM must be vigorous. In this vital mission, the support of organisations like CIPFA and its members are crucial. The journey to Accountability. Now. and greater professional accountancy capacity in developing countries will be a long one – but very much worth taking. The public interest demands that we do.