Question Tag: Accountability

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  • 4 Marks

PSAF – Nov 2016 – L2 – Q4a – Public Procurement

Discuss four benefits for an MDA of following due process in public procurement.

Discuss FOUR benefits that an MDA will derive if it follows the due process in public procurement.
(4 marks)

Benefits of Due Process in Public Procurement
i) The entity will safeguard its public funds and assets
ii) It will improve its system of fiscal management through more efficient and effective use of public monies.
iii) It will enhance transparency and accountability in its management and
procurement processes.
iv) It will be able to build public confidence in its financial activities.
v) It will practice efficient use of resources through competitive bidding and value for money.
vi) It will improve its financial planning system.
(4 points for 4 marks)

  • 10 Marks

AAA – Dec 2023 – L3 – Q4a – Government External Audit and Public Accountability

Discuss the principles under INTOSAI-P 12 that Supreme Audit Institutions (SAIs) should follow to strengthen accountability, demonstrate relevance, and lead by example.

Governments, through Parliament, levy and collect taxes from the citizens of their countries. The taxes collected must be used in providing services to the citizenry. The taxpayer must be assured that taxes paid are used and accounted for transparently. Supreme Audit Institutions (SAIs) are set up under their countries’ constitutions to carry out audits of public funds on behalf of the citizens. According to INTOSAI-P 12: The Value and Benefits of Supreme Audit Institutions – making a difference to the lives of citizens, the extent to which a SAI is able to make a difference to the lives of citizens depends on the SAI:

i) Strengthening the accountability, transparency, and integrity of government and public sector entities;
ii) Demonstrating ongoing relevance to citizens, Parliament, and other stakeholders; and
iii) Being a model organisation through leading by example.

Required:
Discuss THREE (3) principles under each of the headings (i-iii). (10 marks)

i) Strengthening the Accountability, Transparency, and Integrity of Government and Public Sector Entities

  1. Independence of SAIs: SAIs must operate independently from the government and any other entity they audit. This independence ensures that audits are conducted objectively and without undue influence, thereby strengthening the accountability of government and public sector entities.
  2. Public Reporting: SAIs should report their findings to Parliament and the public in a timely and transparent manner. This ensures that the outcomes of audits are available for public scrutiny, which enhances transparency and promotes accountability in the use of public funds.
  3. Audit Scope and Mandate: SAIs should have a broad audit mandate that includes financial audits, compliance audits, and performance audits. This comprehensive approach ensures that all aspects of government and public sector operations are reviewed, leading to a more robust assessment of accountability and integrity.

ii) Demonstrating Ongoing Relevance to Citizens, Parliament, and Other Stakeholders

  1. Stakeholder Engagement: SAIs should actively engage with citizens, Parliament, and other stakeholders to understand their concerns and expectations. By doing so, SAIs can ensure that their work is relevant and addresses the most pressing issues related to public sector accountability.
  2. Timeliness of Audits: SAIs must conduct and complete audits in a timely manner. Timeliness ensures that audit findings are relevant and can be acted upon promptly, which helps maintain the trust and confidence of stakeholders.
  3. Adaptability and Innovation: SAIs should continuously adapt to changes in the public sector environment and adopt innovative audit techniques. This adaptability ensures that SAIs remain relevant in a rapidly changing world and continue to address new and emerging risks effectively.

iii) Being a Model Organisation Through Leading by Example

  1. Ethical Standards: SAIs must adhere to the highest ethical standards in all their operations. By setting a strong ethical example, SAIs reinforce the importance of integrity and ethical behavior in the public sector.
  2. Professional Development: SAIs should invest in the continuous professional development of their staff. A highly skilled and knowledgeable workforce ensures that audits are conducted effectively and that the SAI maintains its credibility as a model organization.
  3. Internal Accountability: SAIs must have robust internal controls and accountability mechanisms in place. By demonstrating accountability within their own operations, SAIs set a standard for the public sector entities they audit and promote a culture of accountability across the public sector.
  • 10 Marks

AAA – Nov 2023 – L3 – Q4a – Government External Audit and Public Accountability, Public Sector Audit

Discuss ways in which the Auditor-General can adopt standards and processes that are objective and transparent, and how the Audit Service can operate economically, efficiently, and effectively.

a) Accountability and transparency are two important elements of good governance. Transparency is a powerful force that, when consistently applied, can help fight corruption, improve governance, and promote accountability.

Accountability and transparency are not easily separated: they both encompass many of the same actions, for instance, public reporting. The concept of accountability refers to the legal and reporting framework, organisational structure, strategy, procedures, and actions. The notion of transparency refers to timely, reliable, clear, and relevant public reporting on its status, mandate, strategy, activities, financial management, operations, and performance. In addition, it includes the obligation of public reporting on audit findings and conclusions and public access to information about the Government audit.

An important principle set out in INTOSAI-P 20: Principles of Transparency and Accountability is that SAIs should adopt audit standards, processes, and methods that are objective and transparent.

Required:

i) Discuss FIVE (5) ways in which the Auditor-General can adopt standards, processes, and methods that are deemed objective and transparent. (5 marks)

ii) Discuss FIVE (5) ways the Audit Service can operate economically, efficiently, effectively, and in accordance with laws and regulations. (5 marks)

i) Ways in which the Auditor-General can adopt standards, processes, and methods that are objective and transparent:

  • Legal Obligation Compliance: The Auditor-General must ensure that their operations meet legal obligations with respect to their audit mandate and required reporting.
  • Adoption of International Standards: The Auditor-General should adopt standards and methodologies that comply with INTOSAI’s fundamental auditing principles as set out in ISSAIs.
  • Communication of Standards: The Auditor-General should communicate what those standards and methodologies are and how they comply with them.
  • Audit Scope Communication: The Auditor-General should communicate the scope of audit activities they undertake under their mandate, based on their risk assessment and planning processes.
  • Engagement with Audited Entities: The Auditor-General should communicate with the audited entity about the criteria on which they will base their opinions, keeping them informed about audit objectives, methodology, and findings.

(5 points @ 1 mark each = 5 marks)

ii) Ways the Audit Service can operate economically, efficiently, effectively, and in accordance with laws and regulations:

  • Sound Management Practices: The Audit Service should employ sound management practices, including appropriate internal controls over financial management and operations, which may include internal audits and other measures.
  • Financial Transparency: The Audit Service should make its financial statements public and subject to external independent audits or parliamentary reviews.
  • Operational and Performance Assessment: The Audit Service should assess and report on its operations and performance in all areas, such as financial audits, compliance audits, jurisdictional activities, performance audits, and program evaluations.
  • Skill Development: The Audit Service should maintain and develop the necessary skills and competencies required to perform work to achieve its mission and meet responsibilities.
  • Budget Reporting: The Audit Service should publicly report on its total budget, the origin of financial resources, and how those resources are used. This includes measuring and reporting on the efficiency and effectiveness with which funds are used.

(5 points @ 1 mark each = 5 marks)

  • 10 Marks

BMIS – May 2021 – L1 – Q1b – Business and organisational structure

Explain five benefits a company would derive from adopting a matrix organizational structure.

International Ltd is a Dutch multinational construction company engaged in different forms of construction in various countries, including Ghana. The company has decided to change its existing organizational structure, which is a functional structure, to a matrix structure in order to improve its operations.

Required:
Explain FIVE (5) benefits the company would derive from this decision.

i) Pooling of Expertise: The essential advantage of the matrix structure is its high expertise base. This is because those in the division are people with varying expertise brought together from different departments.

ii) Improved Decision Making: The matrix structure facilitates the participation of decision-making at the proximity of designated divisions, enabling more informed and quicker decisions.

iii) Enhanced Accountability: The matrix structure enshrines responsibility to employees at the division level, making them accountable for every aspect of their performance.

iv) Learning Grounds: The matrix structure enables employees to acquire new knowledge, skills, and abilities due to the opportunity to work with well-organized multidisciplinary teams.

v) Innovation: The matrix organizational structure adopted by International Ltd would facilitate the development of innovative ideas and new products due to the cross-fertilization of knowledge and skills from different functional specialities.

vi) Increased Motivation: The adoption of the matrix structure would increase employees’ motivation, especially for those who gain inspiration from involvement in challenging jobs.

  • 5 Marks

PSAF – Nov 2023 – L2 – Q5c – Financial statements discussion and analysis

Explain the objectives of financial reporting in the public sector and its usefulness to primary users.

Financial reporting is not an end in itself but a means to an end. The end game of financial reporting is to provide value to the user of the information. In the local government, financial reporting must deliver the expected value to the users.
i) Explain the objective of financial reporting in the public sector.
ii) Explain the usefulness of financial statements of a Metropolitan Assembly to three of its primary users of the information.

i) The objective of financial reporting in the public sector is to provide useful information for accountability and decision-making purposes. Thus, financial reporting is concerned with the provision of financial information that supports the accountability and decision-making needs of the users. In terms of accountability, financial statements serve as a source of information to the users to assess how well the reporting entity applied the resources entrusted to it in the delivery of public value. It enables the users to question the public managers on the use of public resources. Thus, financial statements serve as a tool for demonstrating and assessing accountability of public institutions and their managers. Financial statements also provide information that supports decision-making in the public sector by both the public managers and the users. For example, the decision relating to the allocation of resources is supported by the accounting data. Similarly, the information on the financial performance and propriety of an entity may influence the decision to re-elect the managers of the entities in a democratic context.
(2 marks)

ii) Primary users of financial information of an Assembly include:

  • Local citizens
  • Assembly members (representatives)
  • Central government
  • Rate payers
  • Lenders
  • Donors

Local citizens are service recipients of the local government and therefore may need the financial information to assess:

  • The cost of services provided by the Assembly and the sustainability of the service provided.
  • The accountability of the local managers in terms of how well the resources are used.

Assembly members are representatives of the local citizens in the governance of the Assembly and therefore they need the information to assess:

  • Whether there is compliance with the legally adopted budget of the Assembly.
  • The performance of the programs and projects of the Assembly.
  • Accountability of the local managers.

Central government transfers resources to the Assembly and also grants it the enabling law to operate. Thus, the government needs the financial information to exert accountability in the Assembly and also to make decisions relating to resource allocation.

Rate payers are providers of financial resources to the Assembly and may desire to know how well their rates have been used to provide local services.

Lenders like banks use the financial statements in determining the financial condition of the Assembly to decide whether to lend or not.

Donors support the Assembly with financial and non-financial resources and therefore need the financial statements to assess accountability for the donor and compliance with donor agreements.

(Any 3 points @ 1 mark each = 3 marks)

  • 10 Marks

PSAF – Nov 2019 – L2 – Q5a -Public sector fiscal planning and budgeting

Discuss objectives for ensuring asset control systems and circumstances where accountability is discharged.

a) According to Section 52 of Act 921, “A principal Spending Officer of covered entity, State – Owned enterprise or public corporation shall be responsible for the asset of the institution under the care of the Principal Spending Officer and shall ensure that proper control systems exist for the custody and management of the Assets”.

Required:

i) State and explain TWO (2) objectives for which spending officers are required to ensure the existence of proper control systems. (4 marks)

ii) State and explain any THREE (3) circumstances under which the Principal Spending Officer is discharged of accountability over government stores. (6 marks)

i) Objectives of ensuring proper existence of control systems

  • Preventive mechanisms are in place to eliminate theft, loss, wastage, and misuse; and
  • Processes, whether manual or electronic, and procedures are in place for effective, efficient, economical, and transparent use of the assets.

(2 marks for 1 point each explain = 4 marks)

ii) Circumstances under which the Principal Spending Officer is discharge of accountability of government stores

  • The principal Spending Officer is discharged of accountability of Government stores where the store have been;
    • Consumed in the course of public business and records are available to show that the stores have been consumed;
    • Worn out in the normal course of public business and deletion from the accounts has been approved by the Minister and they have been disposed of in accordance with the directives of the Minister; or
    • Lost, stolen, destroyed, damaged, or rendered unserviceable other than by fair wear and tear and deletion from the accounts has been approved by Parliament.

(2 marks for every 3 points each explain = 6 marks)

  • 5 Marks

PSAF – Nov 2017 – L2 – Q5c -Public sector fiscal planning and budgeting

Identifying mechanisms for achieving value for money in public sector management.

Value for money (VFM) is derived from the optimal balance of benefits and costs on the basis of total cost of ownership. The nature of public financial management is such that it involves discretionary decision-taking on behalf of government at all levels. Value for money is therefore not a choice of goods or services which is based on the lowest bid price but a choice based on the whole life costs of the project or service.

Required: Identify FIVE mechanisms that can be used to achieve “value for money” in public sector management. (5 marks)

Mechanisms Used to achieve value for money in public sector
Value for Money is concerned with obtaining the best possible combination of services from the least resources. It is thus, the pursuit of economy, efficiency, and effectiveness. Below are the mechanisms used to achieve value for money.

  • Economy
    Economy is the term and condition under which an organization acquires human and material resources of the appropriate quality and standard at the lowest cost. From this procurement will be a purchasing activity whose purpose is to give the purchaser the best value for money and that for complex purchases, value may imply more than just price since quality issues also need to be addressed.
  • Efficiency
    Efficiency as the relationship between goods and services produced and resources used to produce them. An efficient operation produces the maximum output for any given set of resource inputs; or, it has a minimum input for any given quantity and quality of services provided. In addition, efficiency implies practicality, especially in terms of compatibility with the government’s administrative resources and professionalism.
  • Transparency & Accountability (Ethical Standards)
    Good procurement holds its practitioners responsible for enforcing and obeying the rules. It makes them subject to challenge and to sanction, if appropriate, for neglecting or bending those rules. Accountability is at once a key inducement to individual and institutional probity, a key deterrent to collusion and corruption, and a key prerequisite for procurement credibility.
  • Accountability, fairness and efficiency in public procurement
    Accountability, fairness, and efficiency are three cardinal pillars that procurement reforms seek to achieve in that a very fair and accountable procurement system helps in the efficient utilization of the state resources judiciously. Procurement practitioners need to be very fair in their day-to-day dealings with their suppliers and potential bidders and the public at large in order to earn the trust of the various actors within the procurement system. Accountability refers to the process of holding an individual or an organization fully responsible for actions and functions they are engaged in and over which they have authority to exercise those functions.
  • Competition
    Competition has been regarded as one of the most important factors in attaining value for money in the Public sector. This is on the premise that competition amongst bidders can lead to improvements in pricing and alternative means of delivering VFM. Competition can either be for the market (i.e. in the bidding process) or competition/contestability in the market which occurs after the contract is concluded and is in operation. On the contrary, the absence of competition or potential entry would lead to difficulties in attaining higher efficiency and value for money.(Any 5 points for 5 marks)
  • 10 Marks

PSAF – Mar 2023 – L2 – Q3a – Public expenditure and financial accountability framework

Describes the scope and goals of the Public Expenditure and Financial Accountability (PEFA) framework.

The Public Expenditure and Financial Accountability (PEFA) program was initiated in 2001 by seven international development partners: The European Commission, International Monetary Fund, World Bank, and the governments of France, Norway, Switzerland, and the United Kingdom. PEFA began as a means to harmonize the assessment of PFM across the partner organizations. It subsequently established a standard methodology for PFM diagnostic assessments, the PEFA framework. Since 2001, PEFA has become the acknowledged standard for PFM assessments.

Required:
Describe the scope and goals of the PEFA framework.

Scope of the PEFA Framework:

The PEFA framework is a methodology for assessing and reporting on the strengths and weaknesses of public financial management (PFM) performance. It identifies 94 characteristics (dimensions) across 31 key components of PFM (indicators) in 7 broad areas of activity (pillars).

The outcome of the performance assessment, the PEFA report, provides the basis for dialogue on PFM reform strategies and priorities. The methodology can be replicated in successive assessments, giving a summary of changes over time as well as providing a pool of information that contributes more broadly to research and analysis of PFM.

Goals of the PEFA Framework:

  1. Strengthen Capacities: To strengthen capacities to assess the status of country PFM systems and develop a practical sequence of reform and capacity development actions.
  2. Encourage Country Ownership: To encourage country ownership of the PFM reform process.
  3. Reduce Transaction Costs: To reduce transaction costs to countries by harmonizing the assessment process.
  4. Enhance Donor Harmonization: To enhance donor harmonization around a common understanding of PFM performance.
  5. Monitor Progress: To allow monitoring of progress in country PFM performance over time.
  6. Address Developmental and Fiduciary Concerns: To better address developmental and fiduciary concerns in the PFM reform process.
  7. Improve Reform Impact: To lead to improved impact of PFM reforms by providing a comprehensive diagnostic tool.
  • 20 Marks

PSAF – Nov 2018 – L2 – Q5 – Public Procurement

Discuss corporate governance issues in the public sector and best practices for PPP arrangements.

a) Good corporate governance is an important way of ensuring accountability and value for money in the public sector.

Required:
i) State and explain FOUR (4) corporate governance problems in the public sector of Ghana. (6 marks)

ii) Discuss FOUR (4) principles of corporate governance that ensure effective accountability and value for money in the public sector. (6 marks)

b) Public-Private Partnership (PPP) is one of the strategies governments can adopt to bridge the infrastructure gap in developing countries. To account effectively for a PPP arrangement, best practices are recommended in executing the arrangements.

Required:
Discuss FOUR (4) best practices that ensure effective PPP arrangements in the public sector. (8 marks)

a) i) Corporate Governance Problems in the Public Sector:

  1. Lack of adherence to rule of law and due process: Public sector entities often fail to strictly follow the rule of law and due process, leading to corruption, inefficiency, and lack of accountability.
  2. Ineffective boards: Many boards in the public sector are dominated by a single individual or a small group, resulting in a lack of independence and poor decision-making.
  3. Conflict of interest: Public officials frequently face conflicts of interest, where personal gain may take precedence over public good, undermining trust and accountability.
  4. Lack of internal and external scrutiny: Insufficient scrutiny from both internal auditors and external watchdogs leads to unchecked power and potential misuse of resources.
  5. Lack of transparency.

ii) Principles of Corporate Governance:

  1. Organizational structure and process: Effective corporate governance requires a clear organizational structure, including defined roles, responsibilities, communication channels, accountability, compliance, and controls. The board should include independent directors and have appropriate committees to oversee various functions.
  2. Controls (risk management, audit, M&E): A robust system of risk management, internal control, and monitoring and evaluation is essential for identifying and mitigating risks, ensuring that resources are used efficiently and effectively.
  3. External reporting: Transparent and timely reporting of financial and performance data is critical for accountability. The board should ensure that these reports are fair, balanced, and understandable to stakeholders.
  4. Audit and accountability: An independent internal audit function and transparent relationships with external auditors ensure that public funds are used as intended, and that any discrepancies are identified and addressed promptly.
  5. Responsibility (towards stakeholders, avoiding conflict of interest, etc)
    The board should be responsible for ensuring that an appropriate dialogue takes place
    among the organisation, its shareholders and other key stakeholders. The board
    should respect the interests of its shareholders and other key stakeholders within the
    context of its fundamental purpose.
  6. Value for money
  7. Rule of Law
  8. Board Independence

b) Best Practices for PPP Arrangements:

  1. Transparency and competition: Ensuring transparency and fostering competition in the procurement process are critical for maintaining public trust and ensuring that PPP arrangements deliver value for money.
  2. Favorable legal framework: Establishing a comprehensive legal framework that governs PPP projects is essential for protecting the interests of both the public and private sectors. This framework should include clear guidelines on contract management, risk allocation, and dispute resolution.
  3. Right project identification: Selecting projects that are technically, socially, and economically viable is crucial for the success of PPP arrangements. The project should align with national development goals and demonstrate clear benefits to the public.
  4. Capacity building: Developing the skills and knowledge of public officials involved in PPP projects is vital for ensuring that these projects are managed effectively. This includes training on negotiation, contract management, and financial analysis.
  5. Extensive stakeholder engagement
    External stakeholders play crucial role in the successful implementation of PPP
    projects. Essentially, stakeholders such as civil society groups, local communities, and
    trade unions should be engaged right from the beginning of the project. Local
    practitioners should desist from engaging external stakeholders at the later stage of
    the project development because it irritates the public and fuels the negative public
    perception on PPP transactions.
  6. Appropriate risk allocation
    Proper risk identification and allocation cannot be undermined when practitioners
    want to achieve success. Risks must be properly identified and allocated to the best
    party. Essentially, contracting authorities should neither retain excessive risks nor
    transfer too many risks to investors. In fact, risk sharing must be balanced. It should
    not be a way of favoring one party since this can result in conflict at a later stage.
  7. Local content and safeguard of consumers rights
  8. Value for money
  • 5 Marks

PSAF – Nov 2021 – L2 – Q5c – General purpose financial reporting framework

Discuss how general-purpose financial reporting supports accountability and decision-making in the public sector.

Discuss how general-purpose financial reporting supports accountability and decision-making in the public sector.

Accountability:
The primary function of governments and other public sector entities is to provide services that enhance or maintain the well-being of citizens and other eligible residents. In most cases, these services are provided due to a non-exchange transaction and in a non-competitive environment. Governments and other public sector entities are accountable to those that provide them with resources and to those that depend on them to use those resources to deliver services during the reporting period and over the longer term. The discharge of accountability obligations requires the provision of information about the entity’s management of the resources entrusted to it for the delivery of services to constituents and others, and its compliance with legislation, regulation, or other authority that governs its service delivery and other operations.

Decision-Making:
Financial information also supports decision-making by the users, who require information as input for making decisions. The information will also be useful for decision-making by users of General Purpose Financial Reports (GPFRs), including decisions that donors and other financial supporters make about providing resources to the entity. Information about the financial position of a government or other public sector entity will enable users to identify the resources of the entity and claims to those resources at the reporting date. This will provide information useful as input to assessments of such matters as:

  • The extent to which management has discharged its responsibilities for safekeeping and managing the resources of the entity.
  • The extent to which resources are available to support future service delivery activities, and changes during the reporting period in the amount and composition of those resources and claims to those resources.
  • The amounts and timing of future cash flows necessary to service and repay existing claims to the entity’s resources.

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