Finance Minister Edward Scicluna addressing the conference at the University of Malta.Finance Minister Edward Scicluna addressing the conference at the University of Malta.

Switching government financial reporting to an accruals basis would involve the re-engineering of all business processes, a revision of policies, a thorough review of legislation, the development of new skills and the reorganisation of the finance function in government, Finance Minister Edward Scicluna warned.

The Treasury was presently undergoing restructuring with the establishment of a unit specifically entrusted with accounting metho­dology and financial reporting functions, he said.

“The development of the government’s accounting system is a current and real priority of this administration. The need for proper government accounting has been on the national agenda for many years. In the past, however, progress was somewhat limited.

“In contrast, the current thrust is to actively address the issue, also in parallel to developments taking place at a European level,”he said.

Prof. Scicluna explained that an accruals-based public sector accounting system – based on the International Public Sector Accounting Standards – would enhance transparency and accountability and improve decision-making, both key areas for economic prosperity.

System would enhance transparency, accountability and improve decision-making

“They will strengthen public finance management and will have a positive impact on the nation’s reputation with credit rating agencies,” he said.

He was speaking at the 15th Biennial Conference of the Comparative International Governmental Accounting Research Network, a network of scholars with a mission to promote worldwide discussion and research on comparative government accounting.

The two-day conference was hosted by the Faculty of Economics, Management and Accountancy of the University of Malta.

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