Professional recruitment a challenge as Malta ploughs on with shift to accruals

4 Dec 18

Attracting accountants to the public sector is one of Malta’s biggest challenges as it shifts to an accrual-based financial reporting system, the director of government accounts has told PF International.

The Mediterranean country plans to have moved all central government accounts to an accrual system by 2020, giving the project team just two and a half years from when Grant Thornton Malta won the €11.6m contract to help with the implementation. 

Michael Zammit Munro is director of the Government Accounts Directorate within the Maltese Treasury and leads the project. He told PF International that Malta was still on track to meet the 2020 deadline.

But he added that a challenge has been ‘resources’ – recruiting sufficient staff and training them.

“We are training [Treasury staff] right now with a 45-hour basic accounting course, because most of them are trained in cash accounting,” he said.

He observed that even the private sector is looking abroad for talent as it struggles to hire enough accountants.

“Imagine if you can’t find staff in the private sector, it is a challenge for the public sector.

“We do offer flex-hours and other incentives to attract accountants or accounting technicians but is still a challenge,” he said.

Zammit Munro added that another difficulty was the time to adapt IT systems to “suit your needs”.

“Although it is an ‘off-the shelf’ package, the processes must be built within the solution so that it works for you.

“This takes time and energy.” But he added that “it is exciting and challenging” and “will pay off”.

Local governments in Malta are already reporting on an accrual basis and central government is currently running 10 pilots across various departments to test processes.

In August last year, the Maltese government explained that shifting from a cash accounting system to accrual accounting will give departments a “more transparent account of income

and their expenditure”.

Asked whether Malta plans to move to an accrual-based budgeting process, Zammit Munro said: “This project will revolutionise the way the government accounts for and reports its finances.

“Budgeting is going to remain on a cash-basis for the moment. Parliament, as such, will still be approving appropriations based on cash-budgeting.”

He added that there was “ownership at the top” of government and ministers and senior officials understood the advantages the shift to accruals would bring.

“The benefits are endless on the system, especially compared to the system we have now, which was started at the end of the 1990s,” said Zammit Munro.

Last year, Malta’s finance minister and former accountant general told PF International that conviction and perseverance were needed to move to an accrual-based accounting system

The National Audit Office in Malta has highlighted the need to shift from cash to accruals for a number of years and its audit staff has been trained in the International Public sector Accounting Standards.

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