Authors: Spyridon Goumas, Pavlos Karastogiannis

Title: Public management reform under the dome of accruals (Presidential Conference 54/2018): Investigation of the effects on the financial information and the audit of the General Government entities

Abstract

Purpose- In Greece, with the Presidential Decree 54/2018, the introduction of the accrual basis of accounting was legislated for all the entities of the General Government from 1/1/2023. Until then, four sectoral accounting plans are implemented for respective General Government entities and the provisions of Presidential Decree 54/2018 for the Central Administration entities. The purpose of this paper is to investigate the effects the introduction of the accrual basis of accounting in the light of Presidential Decree 54/2018 in the financial information and control of the entities of the General Government, as well as the prospect of transition on 1/1/2023.

Methodology-The research was conducted using the qualitative method and the structured interview protocol was the data collection tool. The protocol was based on the bibliographic review of international research and the provisions of the provisions of Presidential Decree 54/2018, and is divided into four main axes which are based on research questions. The reliability and validity of the research was ensured through a pilot research with the distribution of 3 protocols and then followed the drafting of the final protocol. The research population consists of the six employees of the DG department of the General Government Accounting Plan of the General Government Accounting Directorate of the Ministry of Finance.

Findings-The findings of the research showed that the accrual basis accounting in General Government entities will accurately and truthfully reflect the financial operations, financial performance and assets of an entity. Τhe needs for objective financial information are met, tangible and intangible assets, financial instruments, liabilities, cash, depreciation and provisions are more accurately reflected. In addition, the comparability of accounting information between General Government bodies and between Greece and the other countries that have adopted accrual basis accounting is supported. The work of control mechanisms is simplified and more effective control is exercised over public finances. As a result, transparency and accountability are enhanced, corruption of public officials is reduced, and money mismanagement is tackled. At the same time, the understanding of public finances is facilitated by a range of stakeholders. However, the transition to 1/1/2023 is not an easy process as there is an insufficient number of employees, lack of know-how of those already employed and the absence of a unified accounting information system. These factors and in combination with the covid-19 pandemic, led the participants to believe that the implementation process towards the transition to accrual basis accounting from 1/1/2023 for all General Government entities was negatively affected, proposing an extension of the transition date.

Implications-The findings of the research contribute significantly to the scientific dialogue on the need to converge the accrual basis of accounting in the bodies of the General Government, as well will improve the quality and reliability of financial information. At the same time, the difficulties that arise in the implementation of the project are highlighted, which is the lack of an appropriate personnel and information system, which must be resolved in order to complete the reform.

Keywords-Accrual accounting, Accounting reform, General Government, Accountability, Transparency.

JEL classification codes- H83,  P41, M48.