FinMin bats for robust public sector accounting
Kathmandu, May 12
Finance Minister Yubaraj Khatiwada has said that he is committed to keeping discipline in public finance citing that public entities should be more transparent and create value for taxpayers’ money.
Addressing the Public Sector Financial Management (PSFM) Conference of the Asia-Pacific chartered accountants here today, the finance minister stressed spending reforms for optimum output from the government expenses in redistribution of growth. Khatiwada has been laying emphasis on efficient allocation of resources rather than distributing funds to piecemeal projects since he has taken charge as the finance minister.
“The medium-term expenditure framework (MTEF) is the major reform in expenditure sector, which has bound the government to frame its expenditure plans based on this framework,” said Khatiwada. He also shed light on how Treasury Single Account (TSA) is a major reform, as it provides actual daily status of government’s revenue and expenses.
“Nepal has made significant progress in the public finance reforms so far,” said the finance minister, adding, “However, we have a lot to do for transparent and effective utilisation of public funds.” Finance Minister Khatiwada also highlighted that the government’s balance sheet is also prepared as per the international accounting norms.
Since last year, the Nepal government has implemented Nepal Public Sector Accounting Standards (NEPSAS) after executing international accounting standards in private companies and public corporations, that is, Nepal Financial Reporting Standards (NFRS), which was designed and based on the International Financial Reporting Standards. Uniformity in accounting standards in both government and private sectors will promote transparency as investors of any country would be able to easily understand the balance sheets of the Nepali companies, according to the finance minister.
He further said that the government’s balance sheet can also be compared with the other economies that prepare their balance sheets as per the International Public Sector Accounting Standards. The Financial Comptroller General Office (FCGO) has implemented NEPSAS in every ministry and constitutional body since last fiscal 2016-17.
Stating that effective implementation of medium-term expenditure framework was affected by political instability, he said that the tool was a must for making the government and its functions accountable and transparent. He pointed out the lack of reforms and uniformity as key challenges to the public financial management system of the country.
“In order to make the public financial management system more effective, we have to develop and utilise information technology, make our banking system robust and develop capable human resources,” he added.
During his speech, Finance Minister Khatiwada also urged chartered accountants to become accountable and responsible towards their profession. “You must be ethical and maintain financial discipline, and transparency should be your top priority in your profession.”
The conference was organised jointly by the Institute of Chartered Accountants of Nepal (ICAN) and Public Expenditure and Financial Accountability (PEFA) Secretariat in association with Confederation of Asian and Pacific Accountants (CAPA). Over 250 accounting professionals, including 60 international delegates, participated in the conference from 18 different countries of Asia and Pacific.
Prakash Jung Thapa, president of ICAN, emphasised involvement of professionals in government organisations for strengthening public sector financial management.
Similarly, speaking at the conference, Auditor General of Nepal, Tanka Mani Sharma said that the effective implementation of public financial management system will help in making federalism a success in Nepal.
During the technical sessions of the conference, experts and stakeholders presented thematic papers on issues like integrated financial management system, public financial management governance and practices and country experiences, PSFM challenges and the way forward in the federal structure and strengthening audit functions in public sector.