Tool

Accountability for expenditures

Legal or ethical duty to account for the use of funds, equipment and authority.

DESCRIPTION

Organizations that receive public resources or consumer payments for public services are legally and/or morally obliged to report on how they used the funds, equipment, or authority and what they achieved with it.1 This can range from merely publishing the information to conducting social audits, where civil society can actively assess the expenditures of public institutions.

PURPOSE & LINK TO INTEGRITY

By accounting for expenditures, utilities and public institutions can establish credibility, display their commitment to transparency, and foster confidence in the water sector.1 Tracking, controlling, and making expenditures subject to scrutiny can also increase the organization’s financial efficiency. By detecting unreasonably high expenditures, which may point to misappropriation and misuse of resources, accounting for expenditures builds safeguards against illicit practices such as bribery, embezzlement, money laundering, and theft.2,3,4,5

KEY REQUIREMENTS

  • Does your organization have clarity on who it is accountable to?
  • Does your organization have adequate budgeting processes in place?

HOW TO

Accountability for expenditures can be increased by: 1,6

  • Submitting the budget and expenditures to external audits
  • Dividing the responsibility for processing financial transactions
  • Reviewing guidelines to make sure that expenditures are compliant
  • Reviewing transaction reports in a timely manner
  • Holding an annual public hearing on the organization´s expenditures.

For large organizations that disburse funds from national to regional and local levels (e.g. national utilities), public expenditure tracking surveys (PETS) can be conducted to increase the transparency and accountability of budget management. PETS are quantitative exercises that trace the flow of resources from origin to destination and determine the location and scale of irregularities. A PETS typically consists of a combination of data sheets and different questionnaires for interviewing facility managers and users of a given public service. Data sheets are used to collect quantitative data from facility records, and from local, regional, and national government organizations. PETS can be carried out by the ministry of finance, line ministries, independent research institutes, academics or NGOs.2

KEY GUIDING DOCUMENTS

GIZ, no year, Public Expenditure Tracking Survey, GIZ Anti-Corruption Toolbox, Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Germany, https://gizanticorruptiontoolbox.org/wiki/Download, accessed 19.11.2015

Blink UCSD, 2012, Expenditure Accountability Checklist, Blink UC San Diego 2012 (Blink UCSD), http://blink.ucsd.edu/go/accountability, accessed 19.11.2015

OECD, 2002, OECD Best Practices for Budget Transparency, Organisation for Economic Co-operation and Development (OECD), France

FURTHER  READINGS

MANGO, 2012, Financial Management Essentials – A Handbook for NGOs, Management Accounting for Non-governmental Organisations (MANGO), UK

Nordmann, D., Peters, P. and Werchota, R., 2013, Good Governance in the Kenyan Water Sector, Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Germany

PG Exchange, no year, Public Budgets and Expenditures, PG Exchange Toolkit, PG Exchange, http://www.pgexchange.org/images/toolkits/, accessed June 2014

Khan, M. A. and Chowdhury, N., no year, Public accountability, corruption control and service delivery

U4, no year, Accountability, U4 Anti-Corruption Resource Centre (U4), http://www.u4.no/glossary/accountability/#sthash.E6Urw4Kx.dpuf, accessed 19.11.2015

U4, 2013, Key features of NGO accountability systems, U4 Anti-Corruption Resource Centre (U4), Norway

DFID, 2005, Citizens, accountability and public expenditure, Department for International Development (DFID), UK

OECD, 2005, Accountability and control of public spending in a decentralised and delegated environment, Organisation for Economic Cooperation and Development (OECD), France

USAID, 2008, Public expenditure and financial accountability, United States Agency for International Development (USAID), USA

U4, no year, Accountability, U4 Anti-Corruption Resource Centre (U4), http://www.u4.no/glossary/accountability/#sthash.E6Urw4Kx.dpuf, accessed 19.11.2015

FULL REFERENCES

  1. MANGO, 2012, Financial Management Essentials – A Handbook for NGOs, Management Accounting for Non-governmental Organisations (MANGO), UK
  2. GIZ, no year, Public Expenditure Tracking Survey, GIZ Anti-Corruption Toolbox, Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Germany, https://gizanticorruptiontoolbox.org/wiki/Download, accessed 19.11.2015
  3. Nordmann, D., Peters, P. and Werchota, R., 2013, Good Governance in the Kenyan Water Sector, Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, Germany
  4. PG Exchange, no year, Public Budgets and Expenditures, PG Exchange Toolkit, PG Exchange, http://www.pgexchange.org/images/toolkits/, accessed June 2014
  5. Khan, M. A. and Chowdhury, N., no year, Public accountability, corruption control and service delivery
  6. Blink UCSD, 2012, Expenditure Accountability Checklist, Blink UC San Diego 2012 (Blink UCSD), http://blink.ucsd.edu/go/accountability, accessed 19.11.2015
Last updated 11 April 2019

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