Thursday, 12 September 2019 06:17

Effective public financial management crucial, yet often overlooked - CB Governor

Effective public financial management is a crucial, yet all too often overlooked conditions for achieving prosperity with government activities accounting for nearly half of the global economy,” Central Bank Governor Dr. Indrajit Coomaraswamy said.

Dr. Coomaraswamy said that accountants in the public sector have a higher responsibility to act professionally and ethically as they involve in executing transactions, worth millions of dollars of rupees.

He made these views delivering the keynote speech at a seminar held under theme ‘Ethical Responsibility of Professional Accountants in the Public Sector’ and organised by the Association of Public Finance Accountants of Sri Lanka (APFASL), the public sector wing of the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) in Colombo this week.

The role of professional accountants is fundamentally about creating trust and ensuring that number are correctly stated and true and fair accounts being produced, showing how money has been raised and how that money has been used. This is equally true in businesses as well as in the public sector.

Dr. Coomaraswamy said further that violations of public and private trust occur daily, creating unfavourable results.

“Sadly, not everybody who works in the accountancy field is trustworthy. Daily violations of public and private trust do occur, and resolving ethical dilemmas doesn’t always end favorably. Blatant fraud, theft and corruption may make for good movies and front-page news stories; however accountants’ daily work involves much more subtle ethical situations. Decision making doesn’t always come down to a binary “yes” or “no”. The fine line between the two subjects to interpretation and will make up the bulk of the dilemmas that an accountant faces during his or her career,” he said.

He further said that there are ethical standards that the members of the public expect from the public office holders such as to be committed to the public rather than private and to be honest and open in decision making to make decisions in the light of best evidence, to be held accountable and to lead exemplary lives in public office.”

According to a recent survey conducted by Chartered Institute of Public Finance and Accounting in the UK in 2018, he said it has identified that almost over 60 percent of public sector finance professionals have come under pressure to act unethically at least once in their career.

“I do not need to tell this audience how much more challenging the life of a public sector accountant is in a developing country,” the Governor quipped.

He said further that this highlights the necessity for accountants in the public sector to act professionally and ethically all time. In addition professional accountants need to play a visible role within an organization and he or she should have a particularly important role to play in creating, promoting, maintaining an ethical culture within the organization.

He emphasised that that accountants in the public sector have a larger responsibility as holders of public office compared to private sector accountants.

“There are certain ethical standards that members of the public expect from public office holders, such as to be committed to public, to be honest and open in decision making, to make decisions in the light of the best evidence, Dr. Coomaraswamy said.

He added that it is also important for accountants to stay abreast of development in the world of Accounting, so that they can alert their clients about the consequences ,challenges and opportunities that are about to happen.

“An accountant needs to be a shining example of fairness and correctness when handling difficult situations thereby adhering to ethical practices in order to build trust and long –term relationships,” Dr Coomaraswamy noted.

(Daily News)

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