Transparency and reporting key to good governance, CIPFA seminar told

25 Nov 16

Good governance and accountability in public services requires a strong internal audit function, comprehensive external reporting and stakeholder engagement with that information, delegates at the CIPFA international seminar have heard today.

Opening the second day of the conference in Luxembourg, representatives from the UK’s Overseas Development Institute and European Court of Auditors used case studies from Uganda and Europe to communicate lessons learned.

Cathal Long, research officer at the ODI, described how an initiative to improve budget transparency in Uganda highlighted the importance of transparency “feedback loops”.

A series of reforms in the country in the late 90s and early 2000s raised Uganda to the status of the second-most transparent nation in Africa, behind South Africa, and 24th in the world overall.

While corruption fell, Long said, this was “not fast enough”. Too often, funds weren’t reaching local service delivery units, and in 2012 the prime minister’s office was embroiled in a big corruption scandal relating to money from international donors.

This led to a budget transparency initiative centered on the creation of a website that published when funds were released and received by public authorities, as well as how they were spent. Budget documents were also published online.

Local authorities, media and other stakeholders were trained to use the site and were able to interact with it by asking questions and leaving comments. The ministry of finance and other authorities would then respond to and act on these.

“Transparency in isolation doesn’t change much,” said Long, who stressed the importance of investing in such feedback loops.

He noted that there was some anecdotal evidence that the site was already having a positive impact, despite still being a work in progress.

Peter Welch, a director at the European Court of Auditors, highlighted comprehensive reporting as a key element in improving good governance and accountability.

This is one recommendation the court made to the European Commission following an audit of whether the EU executive follows best governance practice.

The audit made use of a framework outlining what good governance looks like in the public sector, developed by CIPFA and the International Federation of Accountants. It focused on two areas of the framework: managing risk and improving public financial management.

While the auditors found the commission had a “good story to tell” in terms of financial reporting, it had significant room for improvement in areas including reporting on the role of its internal audit committee, performance and risk management.

Getting all these areas of external reporting right are key to making the EU fully accountable, said Welch.

The CIPFA/IFAC governance framework also calls for a strong internal audit committee. Welch said the commission could also enhance its audit function, which hadn’t been changed for 15 years.

He applauded the CIPFA/IFAC framework, which he said played a central role in the audit and was a useful tool in turning public sector organisations into “rational” and “altruistic, public utility maximisers”.

  • Emma Rumney

    Emma is a reporter at Cooking Recipes International. She also writes for in the UK.

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