ABSTRACT
Although there has been much debate over the use of accruals accounting for the accounts of national governments, the actual take up has been limited. Since the adoption of accruals accounting by the New Zealand government in 1990 only a small number of additional countries (including Australia, Canada, the UK and the USA) have made the change. This is in spite of the strong encouragement for accruals accounting by the public sector committee of the International Federation of Accountants (IFAC) – the body responsible for developing international public sector accounting standards. An obvious benefit of accruals accounting is that it focuses on the resources consumed in each accounting period in providing services, rather than simply the cash paid and therefore attempts to reflect the full cost of service provision. This, it is argued, leads to improved performance measurement and accountability and control, encourages the more efficient use of resources and provides a better basis for comparison with alternative service providers. 1
